what is a giffen good

A Giffen good is a product that people consume more of as the price rises and vice versa, violating the basic law of demand in microeconomics. It is a low-income, non-luxury product for which demand increases as the price increases and vice versa. Giffen goods are a rarity in economics because supply and demand for these goods are opposite of standard conventions. Examples of Giffen goods can include bread, rice, and wheat, which are commonly essential goods with few near-dimensional substitutes at the same price levels. The phenomenon is known as the Giffen paradox, and it is considered to be the opposite of an ordinary good. To be a true Giffen good, the goods price must be the only thing that changes to produce a change in quantity demanded. It is important to note that all Giffen goods are inferior goods, but not all inferior goods are Giffen goods. The term Giffen good was named after Scottish economist Sir Robert Giffen, who developed the concept after he noticed, in the poor Victorian era, that the rise in the price of a basic food increased the demand for that particular food.