Quasi-linear preferences

Summary

• Quasi linear utility function

\[u\left( x_1,x_2 \right)=v\left( x_1 \right)+x_2\]

• where \(v\) is an arbitrary function (strictly increasing if good 1 is desired).
• Quasilinear preferences: preferences that can be represented by a quasi linear utility function
• Indifference curves are vertical (or horizontal) translates

• Indifference curve for utility \(u_0\) : \(x_2=u_0-v\left( x_1 \right)\)