Revealed Preference in a Discrete Consumption Space

B-Tier
Journal: American Economic Journal: Microeconomics
Year: 2013
Volume: 5
Issue: 1
Pages: 28-34

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We show that an agent maximizing some utility function on a discrete (as opposed to continuous) consumption space will obey the generalized axiom of revealed preference (GARP), so long as the agent obeys cost efficiency. Cost efficiency will hold if there is some good, outside the set of goods being studied by the modeler, that can be consumed by the agent in continuous quantities. An application of Afriat's Theorem then guarantees that there is a strictly increasing utility function on the discrete consumption space that rationalizes price and demand observations. (JEL D11)

Technical Details

RePEc Handle
repec:aea:aejmic:v:5:y:2013:i:1:p:28-34
Journal Field
General
Author Count
2
Added to Database
2026-01-29