History
Together with the concept of an economic "elasticity" coefficient, Alfred Marshall is credited with defining PED ("elasticity of demand") in his book Principles of Economics, published in 1890. He described it thus: "And we may say generally:— the elasticity (or responsiveness) of demand in a market is great or small according as the amount demanded increases much or little for a given fall in price, and diminishes much or little for a given rise in price". He reasons this since "the only universal law as to a person's desire for a commodity is that it diminishes... but this diminution may be slow or rapid. If it is slow... a small fall in price will cause a comparatively large increase in his purchases. But if it is rapid, a small fall in price will cause only a very small increase in his purchases. In the former case... the elasticity of his wants, we may say, is great. In the latter case... the elasticity of his demand is small." Mathematically, the Marshallian PED was based on a point-price definition, using differential calculus to calculate elasticities.
Read more about this topic: Price Elasticity Of Demand
Famous quotes containing the word history:
“Every library should try to be complete on something, if it were only the history of pinheads.”
—Oliver Wendell Holmes, Sr. (1809–1894)
“There has never been in history another such culture as the Western civilization M a culture which has practiced the belief that the physical and social environment of man is subject to rational manipulation and that history is subject to the will and action of man; whereas central to the traditional cultures of the rivals of Western civilization, those of Africa and Asia, is a belief that it is environment that dominates man.”
—Ishmael Reed (b. 1938)
“This above all makes history useful and desirable: it unfolds before our eyes a glorious record of exemplary actions.”
—Titus Livius (Livy)