The impossibility of rational consumer choice
In this paper we show that a rational consumer choice along the lines traditionally suggested might lead to paradoxical results if one considers multidimensional goods, which incorporate a series of incommensurable aspects. Thereby, we explore the similarity between the resulting paradox and Kenneth Arrow’s well known Impossibility Theorem. Based on these considerations we suggest a solution for the former problem along the lines of Herbert Simon and Amos Tversky, which might—if driven to its extreme—even provide a unique and arguably rational solution for consumer choice among multidimensional goods. Eventually, we argue that the resulting framework poses a potentially useful starting point for further developing an evolutionary theory of consumer choice. Copyright Springer-Verlag 2013
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 23 (2013)
Issue (Month): 1 (January)
|Contact details of provider:|| Web page: http://link.springer.de/link/service/journals/00191/index.htm|
|Order Information:||Web: http://link.springer.de/orders.htm|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Stigler, George J & Becker, Gary S, 1977. "De Gustibus Non Est Disputandum," American Economic Review, American Economic Association, vol. 67(2), pages 76-90, March.
- Sugden, Robert, 1991. "Rational Choice: A Survey of Contributions from Economics and Philosophy," Economic Journal, Royal Economic Society, vol. 101(407), pages 751-85, July.
- Mas-Colell, Andreu & Whinston, Michael D. & Green, Jerry R., 1995. "Microeconomic Theory," OUP Catalogue, Oxford University Press, number 9780195102680, March.
- Brian J. Loasby, 2001. "special issue: Cognition, imagination and institutions in demand creation," Journal of Evolutionary Economics, Springer, vol. 11(1), pages 7-21.
- Liran Einav & Jonathan Levin, 2010.
"Empirical Industrial Organization: A Progress Report,"
09-010, Stanford Institute for Economic Policy Research.
- J. Levin & L. Einav., 2012. "Empirical Industrial Organization: A Progress Report," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 1.
- Liran Einav & Jonathan Levin, 2010. "Empirical Industrial Organization: A Progress Report," Journal of Economic Perspectives, American Economic Association, vol. 24(2), pages 145-62, Spring.
- Liran Einav & Jonathan D. Levin, 2010. "Empirical Industrial Organization: A Progress Report," NBER Working Papers 15786, National Bureau of Economic Research, Inc.
- Amartya Sen, 1996.
"Maximization and the Act of Choice,"
Harvard Institute of Economic Research Working Papers
1766, Harvard - Institute of Economic Research.
- Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74, pages 132.
- Sugden, Robert, 1985. "Why Be Consistent? A Critical Analysis of Consistency Requirements in Choice Theory," Economica, London School of Economics and Political Science, vol. 52(206), pages 167-83, May.
- Nelson, Richard & Consoli, Davide, 2010.
"An Evolutionary Theory of Household Consumption Behavior,"
20197, University Library of Munich, Germany.
- Richard Nelson & Davide Consoli, 2010. "An evolutionary theory of household consumption behavior," Journal of Evolutionary Economics, Springer, vol. 20(5), pages 665-687, October.
- Marina Bianchi, 1997. "Collecting as a Paradigm of Consumption," Journal of Cultural Economics, Springer, vol. 21(4), pages 275-289, December.
- Simon, Herbert A, 1978. "Rationality as Process and as Product of Thought," American Economic Review, American Economic Association, vol. 68(2), pages 1-16, May.
- Matthew Rabin., 1997.
"Psychology and Economics,"
Economics Working Papers
97-251, University of California at Berkeley.
- Andreas Reinstaller & Bulat Sanditov, 2005. "Social structure and consumption: on the diffusion of consumer good innovation," Journal of Evolutionary Economics, Springer, vol. 15(5), pages 505-531, November.
- Kenneth J. Arrow, 1950. "A Difficulty in the Concept of Social Welfare," Journal of Political Economy, University of Chicago Press, vol. 58, pages 328.
- Wang, Ge & Huang, Samuel H. & Dismukes, John P., 2004. "Product-driven supply chain selection using integrated multi-criteria decision-making methodology," International Journal of Production Economics, Elsevier, vol. 91(1), pages 1-15, September.
- J.S. Metcalfe, 2001. "special issue: Consumption, preferences, and the evolutionary agenda," Journal of Evolutionary Economics, Springer, vol. 11(1), pages 37-58.
- Kenneth J. Arrow & Herve Raynaud, 1986. "Social Choice and Multicriterion Decision-Making," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262511754, June.
When requesting a correction, please mention this item's handle: RePEc:spr:joevec:v:23:y:2013:i:1:p:39-60. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn)or (Christopher F Baum)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.