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• Engel's Law is an economic theory introduced in 1857, by Ernst Engel, a German statistician, stating that the, percentage of income allocated for food purchases, decreases as income rises., • As a household's income increases, the percentage of, income spent on food decreases while the proportion, spent on other goods (such as luxury goods) increases., This is because the amount and quality of food a family, can consume in a week or month is fairly limited in price, and quantity., Absolute, Expenditure on, Food ($), An Engel curve is a graph that, shows the relationship between, demand for a good (on the x-axis), and income level (on the y-axis). If, Relative, Proportion Spent, on Food (%), the slope of the curve is positive,, the good is a normal good but if it, Income, is negative, the good is an inferior, good.