A comprehensive approach to revealed preference theory

Hiroki Nishimura, Ahmet Ok, John K.H. Quah

    Research output: Contribution to journalArticle

    Abstract

    We develop a version of Afriat's theorem that is applicable in a variety of choice environments beyond the setting of classical consumer theory. This allows us to devise tests for rationalizability in environments where the set of alternatives is not the positive orthant of a Euclidean space and where the rationalizing utility function is required to satisfy properties appropriate to that environment. We show that our results are applicable, amongst others, to choice data on lotteries, contingent consumption, and intertemporal consumption.

    Original languageEnglish (US)
    Pages (from-to)1239-1263
    Number of pages25
    JournalAmerican Economic Review
    Volume107
    Issue number4
    DOIs
    StatePublished - Apr 1 2017

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    Preference theory
    Revealed preference
    Rationalizability
    Consumer theory
    Lottery
    Utility function

    ASJC Scopus subject areas

    • Economics and Econometrics

    Cite this

    A comprehensive approach to revealed preference theory. / Nishimura, Hiroki; Ok, Ahmet; Quah, John K.H.

    In: American Economic Review, Vol. 107, No. 4, 01.04.2017, p. 1239-1263.

    Research output: Contribution to journalArticle

    Nishimura, H, Ok, A & Quah, JKH 2017, 'A comprehensive approach to revealed preference theory', American Economic Review, vol. 107, no. 4, pp. 1239-1263. https://doi.org/10.1257/aer.20150947
    Nishimura, Hiroki ; Ok, Ahmet ; Quah, John K.H. / A comprehensive approach to revealed preference theory. In: American Economic Review. 2017 ; Vol. 107, No. 4. pp. 1239-1263.
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