A Theory of Demand with Variable Consumer Preferences

Abstract

A theory of consumer demand with variable preferences. The assumption that the individual consumer has a unique ordinal utility index function is replaced by the assumption that he has a family of ordinal utility functions; advertising expenditures by the sellers of commodities are assumed to determine which one of these ordinal utility functions is to be maximized. From these assumptions are derived a number of theoretical relations which measurements defining advertising elasticities of demand must satisfy. The relations involving shifts in demand and advertising elasticities of demand are shown to be analogues of the theorems of consumer demand under fixed preferences.