Among the reasons behind the choice behavior of an individual taking a stochastic form are her potential indifference or indecisiveness between certain alternatives, and/or her willingness to experiment in the sense of occasionally deviating from choosing a best alternative in order to give a...

Recent contributions to the literature [Plott and Zeiler (2005, forthcoming) and Isoni et al (2009)] have questioned the robustness of the well documented WTA/WTP disparity showing that it can be eliminated with experimental procedures. However, a formal mathematical model explaining the role of...

Experiments on revealed preference often use budget sets for participants that are randomly and independently drawn according to some criteria. However, this means that the budgets and choices of different individuals are not immediately comparable. This paper proposes a method to control for...

Experiments on revealed preference often use budget sets that are randomly and independently drawn according to some criteria for each participant. However, this means that the budget sets faced by different individuals are not the same. This paper proposes a method to control for these...

It is shown how to test revealed preference data on choices under uncertainty for consistency with first and second order stochastic dominance (FSD or SSD). The axiom derived for SSD is a necessary and sufficient condition for risk aversion. If an investor is risk averse, stochastic dominance...

A nonparametric approach is presented to test whether decisions on a probability simplex could be induced by quasi concave preferences. Necessary and sufficient conditions are presented. If the answer is affirmative, the methods developed here allow to reconstruct bounds on indifference curves....