Testing revealed preferences for homotheticity with two-good experiments

A-Tier
Journal: Experimental Economics
Year: 2013
Volume: 16
Issue: 1
Pages: 114-124

Score contribution per author:

4.022 = (α=2.01 / 1 authors) × 2.0x A-tier

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

Abstract

It is shown that for two dimensional commodity spaces any homothetic utility function that rationalizes each pair of observations in a set of consumption data also rationalizes the entire set. The result is used to provide a simplified nonparametric test for homotheticity of demand and a measure for homothetic efficiency. The article thus provides a useful tool to screen data for severe violations of homotheticity before estimating parameters of homothetic utility functions. The new test and measure are applied to previously published data. Copyright Economic Science Association 2013

Technical Details

RePEc Handle
repec:kap:expeco:v:16:y:2013:i:1:p:114-124
Journal Field
Experimental
Author Count
1
Added to Database
2026-02-02