Consumer's surplus


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1.(Polit. econ.) The excess that a purchaser would be willing to pay for a commodity over that he does pay, rather than go without the commodity; - called also consumer's rent.
The price which a person pays for a thing can never exceed, and seldom comes up to, that which he would be willing to pay rather than go without it. . . . The excess of the price which he would be willing to pay rather than go without it, over that which he actually does pay, is the economic measure of this surplus satisfaction. It has some analogies to a rent; but is perhaps best called simply consumer's surplus.
- Alfred Marshall.
References in periodicals archive ?
Mishan wrote, "The consumer's surplus is the most crucial concept in the measurement of social benefits in any social cost-benefit calculation.
Consumer's surplus without apology RD Willig--The American Economic Review.
See Robert Willig, Consumer's Surplus Without Apology: Reply," 69 Am.
the consumer's surplus (CS) is graphically defined by the area between the demand curve and the price curve, being determined as the difference between the gross benefit (placed on the demand line) and the effectuated payments, represented by price.
Bailey's consumer's surplus formulae are derived and used to compute the welfare cost of inflation for both semi-log and log-log money demand functions.
If the consumer's surplus for good i is clearly larger than for any other good on the list, then it is probably that this opportunity cost could function somehow in the opposite direction, generating a thinking such as: "the good k seemed kind of expensive, anyway; instead of maintaining the quantity I buy constantly, I'd rather reduce it and direct the money towards good i, which has a more reasonable price".
1981) Exact Consumer's Surplus and Deadweight Loss.
By considering the comparison of consumer's surplus and firm's profit, we derive the interesting result that both consumers and the firm will prefer discriminatory pricing if the consumers prefer to consume more differentiated varieties.
16) With these demand parameter values, the consumer's surplus at [p.
All the intramarginal gains are dissipated in increased consumer's surplus.
The increase in wholesale price of wheat in Pakistan and resultantly decrease in quantity demanded would have caused a loss of consumer's surplus of Rs 12,557 million (using Equation 5 of the analytical framework in methodology).
31) For a technical analysis of the conventional measurement of consumer surplus, see Robert Willig, Consumer's Surplus Without Apology, 66 AM.
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