A Simplified Test for Preference Rationality of Two-commodity Choice
AbstractWe provide a simplified test to determine if choice data from a two-commodity consumption set satisfies the Generalized Axiom of Revealed Preference (GARP), and thus the preference or utility maximization hypothesis. We construct an algorithm for this test and illustrate its application on experimental choice data.
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Bibliographic InfoPaper provided by Department of Economics, Emory University (Atlanta) in its series Emory Economics with number 0421.
Date of creation: Dec 2004
Date of revision:
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-12-20 (All new papers)
- NEP-DCM-2004-12-22 (Discrete Choice Models)
- NEP-EXP-2004-12-21 (Experimental Economics)
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