Illustrated with figures and tables. (8vo) original blue cloth with gilt lettered spine. First Edition.

Scarce first edition of the Nobel Prize winning economist's first book. A study for the National Bureau of Economic Research, where Friedman worked at the time. He set forth the permanent income hypothesis, a theory of consumption that assumes rational behavior by agents. In its simplest form, the hypothesis states that a change in permanent income, rather than a change in temporary income, affects the choices that determine a consumer's consumption patterns. The key conclusion of this theory is that transitory, temporary changes in income have little effect on consumer spending behavior, whereas permanent changes can have large effects on consumer spending behavior.