The Amoroso Robinson relation describes the relationship between price, Grenzumsatz and direct price elasticity of the demand in the

One can take the following from the Amoroso Robinson relation:

1. The Grenzumsatz agrees with the price, if the direct price elasticity of the demand (absolute) is infinite (perfect competition).
2. The Grenzumsatz is smaller than the price, if the direct price elasticity of the demand is not perfectly flexible (negatively bent price paragraph function).
3. The Grenzumsatz is negative, if the direct price elasticity of the demand (absolute) is below 1. No (more interested in the profit) offerer offers therefore within the inelastic range.

Beyond that the Amoroso Robinson relation is important for the derivative of the monopoly degree.

The relation formally reads

\ frac {\ partial E} {\ partial x_i} = p_i* \ left (1 \ frac {1} {\ left| \ eta_ {x_ {i} p} \ right|} \ right),

whereby \ partial e designates \ partial x_i the Grenzumsatz (border proceeds), x_i the property, p_i the price of the property, and \ eta_ {x_ip} the price elasticity of the demand.

This text be based on the micro economics glossary of professor Wilhelm Lorenz and is licensed under GNU-FDL.

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