Microeconomics Analysis and Policy

Paper Summary:

This paper examines the theoretical concept of consumer surplus and investigates whether it is measurable. Specifically, the author attempts to demonstrate that consumer surplus can describe a definite conceptual idea, but that any attempt at quantifying results is a logical contradiction.
Introduction and Thesis
The Concept
The Measurement
The Problem of Measurement
Conclusions

From the Paper:

"Before beginning a theoretical analysis of the concept of consumer surplus, a brief sketch of the thoughts of other authors is in order. According to George Stigler (1965, p.79), the history of the concept can be traced back to Jules Dupuit (1884), and his search for a justification of public works. Alfred Marshall (1920, p.103) first coined the term "consumer' surplus" to describe for a consumer "the excess of the price he would be willing to pay rather than going without the thing, over that which he actually does pay." Thus the reference to Marshallian Consumer Surplus came into the lexicon."

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