A More Practical Method for Explaining Demand

Abstract

Demand analysis in general needs to deal with two fundamental elements: the first is the necessary identification of timing and special differences and the second is the necessary separation of ability and willingness in personal consumption behavior. Only by taking both considerations into account and adopting portfolio theory as the analytical framework and tool, can demand be realistically explained. As a consequence, this study demonstrates that numerous demand issues, including the designing of a national improvement indicator of economic life, can all be reasonably studied.