Comparative Statics With Constraints
A generalization of the above method allows the optimization problem to include a set of constraints. This leads to the general envelope theorem. Applications include determining changes in Marshallian demand in response to changes in price or wage.
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Famous quotes containing the words comparative and/or constraints:
“Our comparative fidelity was fear of defeat at the hands of another partner.”
—Max Frisch (1911–1991)
“The analogy between the mind and a computer fails for many reasons. The brain is constructed by principles that assure diversity and degeneracy. Unlike a computer, it has no replicative memory. It is historical and value driven. It forms categories by internal criteria and by constraints acting at many scales, not by means of a syntactically constructed program. The world with which the brain interacts is not unequivocally made up of classical categories.”
—Gerald M. Edelman (b. 1928)