636
PONTIFICIAE ACADEMIAE SCIENTIARVM SCRIPTA VARIA -
7
income, we should obtain families of curves of the following
shapes:
Der-capréa
expenditure
Se ration
level
r-capita
eal income
Fic
Curves of type (a) are likely to fit the cases of goods which
are absolutely necessary for physiological reasons (e.g. food),
and curves of type (b) are likely to fit almost all other cases.
Type (c) finally represents the typical behaviour of inferior
goods (1).
Of course, the relation between expenditure on each single:
commodity and real income, represented in fig. 1, is limited
by the two-dimensional character of the diagrams. The actual
time-path of each single expenditure will also depend on the
variation of the structure of prices. It is important to realize,
however, that the shapes of the relations represented in fig. 1
will remain unaffected.
7. The criterion for the choice of the hvpotheses
Before going on to considering the general dynamic model
to which the foregoing discussion has graduallv paved the wav.
(1) J. AITCHINSON and J.A.C. Brown (in The Log-normal Distribution,
Cambridge, 1957, chap. 12) suggest a function based on the log-normal
distribution, as a general function capable of fitting almost all the cases
of ENGEL curves. The shape of the function is of the type (b) represented
in fig. 1.
10] Pasinetti - pag. 66