Revealed Preference Theory, Ordering and the Axiom of Sequential Path Independence
AbstractThis paper is concerned with the axiomatic foundation of the theory of choice. Describing a choice procedure which one often observes in real life, the author shows that the requirement of path independence of such a procedure is a necessary and sufficient condition for transitive or full rationalization of a choice function. It is shown that the result holds when rationality is identified with different interpretations of the binary relations of preference revealed by a choice function. It is also shown that a weaker version of our path independence condition is both necessary and sufficient for a rational choice. Copyright 1988 by The Review of Economic Studies Limited.
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Bibliographic InfoArticle provided by Wiley Blackwell in its journal Review of Economic Studies.
Volume (Year): 55 (1988)
Issue (Month): 2 (April)
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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0034-6527
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- Bandyopadhyay, Taradas & Sengupta, Kunal, 1999. "The Congruence Axiom and Path Independence," Journal of Economic Theory, Elsevier, vol. 87(1), pages 254-266, July.
- Bandyopadhyay, Taradas & Sengupta, Kunal, 2003. "Intransitive indifference and rationalizability of choice functions on general domains," Mathematical Social Sciences, Elsevier, vol. 46(3), pages 311-326, December.
- Taradas Bandyopadhyay, 2011. "Choice procedures and power structure in social decisions," Social Choice and Welfare, Springer, vol. 37(4), pages 597-608, October.
- He, Junnan, 2012. "A generalized unification theorem for choice theoretic foundations: Avoiding the necessity of pairs and triplets," Economics Discussion Papers 2012-23, Kiel Institute for the World Economy.
- Yuval Salant, 2011. "Procedural Analysis of Choice Rules with Applications to Bounded Rationality," American Economic Review, American Economic Association, vol. 101(2), pages 724-48, April.
- He, Junnan, 2011. "A Generalization of Sen’s Unification Theorem: Avoiding the Necessity of Pairs and Triplets," MPRA Paper 37094, University Library of Munich, Germany.
- He, Junnan, 2012. "On the Necessity of Pairs and Triplets for the Equivalence between Rationality Axioms," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 6(31), pages 1-15.
- Taradas Bandyopadhyay & Kunal Sengupta, 2006. "Rational Choice and von Neumann– Morgenstern’s Stable Set: The Case of Path-dependent Procedures," Social Choice and Welfare, Springer, vol. 27(3), pages 611-619, December.
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