Ernst Engel

Ernst Engel

Born: 1821. Died: 1896.

Biography

German statistician, the head of the Prussian Statistical Bureau (1860-1882), known for the "Engel curve," or Engel's law, which states that the proportion of expenditure on food will fall as income rises, i.e. food is a necessary good.

Engel's law applies to goods as a whole. Demand for food, clothing and shelter - and for most manufactured products - doesn't keep pace with increases in incomes.

Engel curves are useful for separating the effect of income on demand from the effects of changes in relative prices.

Engel also examined the relationship between the size of the Prussian rye harvest and the average price of rye over a number of years prior to 1860, probably the first empirical study of the relationship between price and supply.

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