Scholarly Comments on Academic Economics

Some Anomalies Arising from Bandwagons that Impart Upward Sloping Segments to Market Demand

by

Abstract

In Gary Becker’s (1991) theory of bandwagon effects, a portion of market demand is positively sloped. In this, he ignores Harvey Leibenstein’s (1950) hypothesis that market demands for bandwagon goods are everywhere negatively sloped (stemming from scarcity imposed constraints). A substantial literature now invokes Becker’s bandwagon, also ignoring Leibenstein. Two anomalies attend Becker’s bandwagon demand when it slopes upward: 1) straightforward parameterizations are inconsistent with the economic requirement that quantities demanded be non-negative; 2) regardless of parameterization, the comparative statics of Becker’s demand carry unworldly implications.

in

Download this article

Volume (Issue)
Pages
21-34
Published
JEL classification
D01, D40, D62
Keywords
Bandwagon effect, law of demand
Downloads
2,857 article downloads
4,590 complete issue downloads
Total: 7,447

Discuss this article!