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A Comment on Revealed Preference with a Subset of Goods

van Bruggen, Paul - 2016

Varian (1988) introduced an important proposition regarding restrictions on consumption data if observations of the quantities of a good are missing. In this paper, a simple counterexample is presented to show that the original proof is incorrect, and a new proof is provided. The new proof is...

Persistent link: https://www.econbiz.de/10011586683

Afriat in the Lab

Heufer, Jan; van Bruggen, Paul - 2016

Varian (1988) showed that the utility maximization hypothesis cannot be falsified when only a subset of goods is observed. We show that this result does not hold under the assumptions that unobserved prices and expenditures remain constant. These assumptions are naturally satisfied in laboratory...

Persistent link: https://www.econbiz.de/10011586710

The anatomy of distributional preferences with group identity

Muller, Daniel - 2017

This paper dissects distributional preferences with group identity in a modified dictator game. I estimate individual-level utility functions with two parameters that govern the trade-offs between equity and efficiency and giving to self and to other. Subjects put on average less weight on...

Persistent link: https://www.econbiz.de/10011662169

Social norms and preferences for generosity are domain dependent

Erkut, Hande - 2018

Experimental research on generosity has focused predominantly on behavior in the monetary domain, although many real life decisions take place in the non-monetary domain. Investigating generosity preferences in the non-monetary domain is important to understand a large class of situations...

Persistent link: https://www.econbiz.de/10011947458

A Geometric Measure for the Violation of Utility Maximization

Heufer, Jan - 2008

function. If a consumer is inconsistent with GARP, we might need a measure for the severity of inconsistency. One widely used …

Persistent link: https://www.econbiz.de/10010271072

Testing Axioms of Revealed Preference in Stata

Demetry, Marcos; Hjertstrand, Per; Polisson, Matthew - 2020

This paper introduces the Stata commands checkax, aei, and powers as a bundle within the package rpaxioms. The first command allows the user to test whether consumer demand data satisfy a number of revealed preference axioms at a given efficiency level, the second command calculates measures of...

Persistent link: https://www.econbiz.de/10012615410

Aggregation without the aggravation? Nonparametric analysis of the representative consumer

Cherchye, Laurens; Crawford, Ian; De Rock, Bram; … - 2011

In the tradition of Afriat (1967), Diewert (1973) and Varian (1982), we provide a revealed preference characterisation of the representative consumer. Our results are simple and complement those of Gorman (1953, 1961), Samuelson (1956) and others. They can also be applied to data very readily...

Persistent link: https://www.econbiz.de/10010282357

Revealed Preference and Nonparametric Analysis – Continuous Extensions and Recoverability

Heufer, Jan - 2012

This paper shows how revealed preference relations, observed under general budget sets, can be extended using closure operators which impose certain assumptions on preferences. Common extensions are based on the assumption that preferences are convex and/or monotonic, but we also consider...

Persistent link: https://www.econbiz.de/10010287290

Generating Random Optimising Choices

Heufer, Jan - 2012

Generalised Axiom of Revealed Preferences (GARP), that is, they are consistent with utility maximisation. The choices are drawn … from an approximate uniform distribution on the admissible region on each budget which ensures consistency with GARP, based … it can be used to approximate the power of tests for conditions for which GARP is a necessary but not sufficient …

Persistent link: https://www.econbiz.de/10010287336

Samuelson's approach to revealed preference theory: Some recent advances

Demuynck, Thomas; Hjertstrand, Per - 2019

Since Paul Samuelson introduced the theory of revealed preference, it has become one of the most important concepts in economics. This chapter surveys some recent contributions in the revealed preference literature. We depart from Afriat's theorem, which provides the conditions for a data set to...

Persistent link: https://www.econbiz.de/10012145499