xBookUtils.terms['fn_5_501'] = "These data are collected from various U.S. Census Bureau publications.";
xBookUtils.terms['fn_5_502'] = "It’s not exactly an Engel curve for a few reasons. For one, we aren’t able to hold constant everything else about households’ choices. To read Figure 5.6 as an Engel curve, we’re assuming that every household is the same except for its income level. In reality, households might differ in their preferences and size as well as incomes. Furthermore, different households might face various prices for square footage depending on where they live. If these prices are related to income levels (say, because people who live in urban areas both have higher average incomes and face higher house prices per square foot), this could mix up price and income effects. Nevertheless, the relationship in Figure 5.6 is probably close to the true Engel curve for square footage.";
xBookUtils.terms['fn_5_503'] = "For instance, it is much easier to describe the properties of a demand curve when there is no income effect, only a substitution effect. Demand curves that reflect only substitution effects are known as “Hicksian demand curves” in honor of the economist Sir John Hicks. The demand curves that combine both effects—the kind you’re accustomed to working with, and the kind we’ll continue to use throughout the text—are called “Marshallian demand curves” after economist Alfred Marshall. Because we stick with this standard demand curve throughout the book, we’ll skip the modifier and just keep calling them demand curves.";
xBookUtils.terms['fn_5_504'] = "This logic also explains why perfect substitutes, the special case we discussed in Chapter 4 with perfectly straight indifference curves, have the largest substitution effects. There, a small relative price change can lead the consumer to shift from one corner solution to another—that is, from consuming all of one good, A, and none of the other good, B, to consuming only B and no A. (To see this, suppose all a consumer cares about is the number of potato chips he consumes, and he views 3-ounce and 12-ounce bags of chips as perfect substitutes. If the price of 12-ounce bags is less than 4 times the price of 3-ounce bags, he will only buy 12-ounce bags. But if the price of 12-ounce bags is just a bit more than 4 times the price of 3-ounce bags, he will only buy 3-ounce bags.) It’s also why perfect complements, with their right-angled indifference curves, have no substitution effect; they are always consumed in constant proportion regardless of relative prices.";
xBookUtils.terms['fn_5_505'] = "Gerald P. Dwyer Jr. and Cotton M. Lindsay, “Robert Giffen and the Irish Potato,” American Economic Review 74, no. 1 (1984): 188–192. Sherwin Rosen, “Potato Paradoxes.” Journal of Political Economy 107, no. 6 (1999): S294–S313.";
xBookUtils.terms['fn_5_506'] = "Robert T. Jensen and Nolan H. Miller, “Giffen Behavior and Subsistence Consumption,” American Economic Review 98, no. 4 (2008): 1553–1577.";
xBookUtils.terms['fn_5_507'] = "The data in this application are from www.boxofficemojo.com.";
xBookUtils.terms['fn_5_508'] = "Even though the slope of the market demand curve is always flatter than that of individual demand curves, it doesn’t necessarily imply that the elasticity of the market demand curve is higher than that of individual demand curves (though such is often the case). This is because the elasticity doesn’t just depend on the slope, but also on the level of demand. The percentage change in prices (the denominator in the elasticity equation) will be the same for both individuals and the market. While the change in quantity will be smaller for individuals, the level of demand will be lower, too. If the level is small enough, the percentage change in quantities for the individual can be large enough to make individual demand as elastic as, or more elastic than, market demand.";
xBookUtils.terms['fn_5_509'] = "That wasn’t the only humanlike behavior these monkeys exhibited when exposed to money—for the whole amusingly sordid story, see the epilogue to SuperFreakonomics.";