On the Valuation of Social Income-Reflections on Professor Hicks' Article. Part I.

PROFESSOR HICKS deals first with the case of an individual in two situations, distinguished by different quantities of goods purchased (q'1, qL, etc., in Situation I and q'2, q2, etc., in Situation II) at different prices (P'i, p,, etc., and P'2, P2, etc.). Constant wants or unchanged tastes are assumed, with the consequence that the indifference curves in the two situations belong to the same system, and, therefore, cannot intersect. The criteria by which one can judge whether an individual's welfare increased from Situation I to II are given as follows: