Tuesday, February 3, 2009

Inferior Goods

In yesterday's Wall Street Journal there is an excellent article - "In Sole Revival, the Recession Gives Beleaguered Cobblers New Traction" - about cobblers or shoe repairmen. The essence of the article is that with the economic downturn (i.e. declining consumer incomes) that consumers are increasing their demand for shoe repairs as opposed to purchasing new shoes. Thus shoe repairs are an example of an inferior good; as income decreases the demand for shoe repairs increases.

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