In economics and consumer theory, quasilinear utility functions are linear in one argument, generally the numeraire. Formally, for example, such a utility function could be written <math>U(x,y) = u(x) + by</math>, where <math>b</math> is a positive constant. Then if <math>u'(x)>0</math> and <math>u(x)<0</math>, the indifference curves are parallel.
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- In economics and consumer theory, quasilinear utility functions are linear in one argument, generally the numeraire. Formally, for example, such a utility function could be written <math>U(x,y) = u(x) + by</math>, where <math>b</math> is a positive constant. Then if <math>u'(x)>0</math> and <math>u(x)<0</math>, the indifference curves are parallel. Because in standard consumer theory utility functions are ordinal, one may assume without loss of generality that <math>b = 1</math>. Informally, an agent has quasilinear utility if it can express all its preferences in terms of money and the amount of money it has doesn't affect this utility. As a practical matter in mechanism design, quasilinear utility ensures that agents can compensate each other with side payments.
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- In economics and consumer theory, quasilinear utility functions are linear in one argument, generally the numeraire. Formally, for example, such a utility function could be written <math>U(x,y) = u(x) + by</math>, where <math>b</math> is a positive constant. Then if <math>u'(x)>0</math> and <math>u(x)<0</math>, the indifference curves are parallel.
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