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Persistent link: https://www.econbiz.de/10001573443
This article reviews recent developments in revealed preference theory. It discusses the testable implications of theories of choice that are germane to specific economic environments. The focus is on expected utility in risky environments, subjected expected utility and maxmin expected utility...
Persistent link: https://www.econbiz.de/10012404579
We develop a theory of stability in many-to-many matching markets. We give conditions under which the setwise-stable set, a core-like concept, is nonempty and can be approached through an algorithm. The usual core may be empty. The setwise-stable set coincides with the pairwise-stable set and...
Persistent link: https://www.econbiz.de/10011599371
We develop observable restrictions of well-known theories of bargaining over money. We suppose that we observe a finite data set of bargaining outcomes, including data on allocations and disagreement points, but no information on utility functions. We ask when a given theory could generate the...
Persistent link: https://www.econbiz.de/10011599507
We present a theoretical explanation of inefficient early matching in matching markets. Our explanation is based on strategic complementarities and strategic unraveling. We identify a negative externality imposed on the rest of the market by agents who make early offers. As a consequence, an...
Persistent link: https://www.econbiz.de/10011599561
We experimentally study the Gale and Shapley, 1962 mechanism, which is utilized in a wide set of applications, most prominently the National Resident Matching Program (NRMP). Several insights come out of our analysis. First, only 48% of our observed outcomes are stable, and among those a large...
Persistent link: https://www.econbiz.de/10011599705
We investigate stochastic choice when only the average and not the entire distribution of choices is observable, focusing attention on the popular Luce model. Choice is pathindependent if it is recursive,in the sense that choosing from a menu can be broken up into choosing from smaller...
Persistent link: https://www.econbiz.de/10012010020
We generalize the standard revealed preference exercise in economics, and prove a sufficient condition under which the revealed preference formulation of an economic theory has universal implications and when these implications can be recursively enumerated. We apply our theorem to two theories...
Persistent link: https://www.econbiz.de/10012010075
We propose a new measure of deviations from expected utility, given data on economic choices under risk and uncertainty. In a revealed preference setup, and given a positive number e, we provide a characterization of the datasets whose deviation (in beliefs, utility, or perceived prices) is...
Persistent link: https://www.econbiz.de/10011932098
We propose a new measure of deviations from expected utility, given data on economic choices under risk and uncertainty. In a revealed preference setup, and given a positive number e, we provide a characterization of the datasets whose deviation (in beliefs, utility, or perceived prices) is...
Persistent link: https://www.econbiz.de/10011932968