Robert Giffen

Robert GiffenRobert Giffen (1837-1910) was a Scottish economist and statistician who also had a great reputation in the fields of finance and taxation. He also participated in the editing process in numerous publication, such as the Daily News, The Economist and The Times. However, Robert Giffen is mostly known for giving name to the concept Giffen goods.

It was Alfred Marshall who, in the third edition of his “Principles of Economics”, 1895, wrote:

As Mr. Giffen has pointed out, a rise in the price of bread makes so large a drain on the resources of the poorer labouring families and raises so much the marginal utility of money to them, that they are forced to curtail their consumption of meat and the more expensive farinaceous foods: and, bread being still the cheapest food which they can get and will take, they consume more, and not less of it.”

In other words, Giffen goods are those inferior goods whose demand moves in the same direction as the price variation. This meaning, raising the price of the good will increase its demand.