Changes

A Giffen good has a decrease in demand when its price decreases.  This violates the [[Law of Demand]] and is very unusual or even non-existent.  An equivalent way of defining a Giffen good is to say the rise in its price causes an increase in its demand.

A Giffen good has a decrease in demand when its price decreases.  This violates the law of [[demand]] and is very unusual or even non-existent.  An equivalent way of defining a Giffen good is to say the rise in its price causes an increase in its demand.

For a Giffen good to exist, three extraordinary economic characteristics must exist at the same time.  First, the good must be an [[inferior good]], such that the demand for the good decreases with an increase in consumer income.  Second, the good must have an extraordinary [[income effect]], such that a decline in price of the good causes a significance rise in real income or wealth by consumers due to the savings.  Third, there must be no substitutes available for the good.

For a Giffen good to exist, three extraordinary economic characteristics must exist at the same time.  First, the good must be an [[inferior good]], such that the demand for the good decreases with an increase in consumer income.  Second, the good must have an extraordinary [[income effect]], such that a decline in price of the good causes a significance rise in real income or wealth by consumers due to the savings.  Third, there must be no substitutes available for the good.