Normality of Demand in a Two-Goods Setting
We study the testable implications of normal demand in a two-goods setting. For a finite dataset on prices and quantities, we present the revealed preference conditions for normality of one or both goods. Our characterization provides an intuitive extension of the well-known Weak Axiom of Revealed Preference, and is easy to use in practice. We illustrate the empirical relevance of our theoretical results through an application to the experimental dataset presented in Andreoni and Miller (2002).
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- Varian, Hal R, 1982. "The Nonparametric Approach to Demand Analysis," Econometrica, Econometric Society, vol. 50(4), pages 945-973, July.
- Chambers, Christopher P. & Echenique, Federico & Shmaya, Eran, 2010.
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- Christopher P. Chambers & Federico Echenique & Eran Shmaya, 2007. "On Behavioral Complementarity and its Implications," Documentos de Trabajo (working papers) 1007, Department of Economics - dECON.
- Chambers, Christopher P. & Echenique, Federico & Shmaya, Eran, 2007. "On behavioral complementarity and its implications," Working Papers 1270, California Institute of Technology, Division of the Humanities and Social Sciences.
- Christopher P. Chambers & Federico Echenique & Eran Shmaya, 2011. "Testable Implications of Gross Substitutes in Demand for Two Goods," American Economic Journal: Microeconomics, American Economic Association, vol. 3(1), pages 129-136, February.
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- Ennio Bilancini & Leonardo Boncinelli, 2010. "Preferences and Normal Goods: An Easy-to-Check Necessary and Sufficient Condition," Center for Economic Research (RECent) 042, University of Modena and Reggio E., Dept. of Economics "Marco Biagi".
- James Andreoni & Charles Sprenger, 2012. "Estimating Time Preferences from Convex Budgets," American Economic Review, American Economic Association, vol. 102(7), pages 3333-3356, December.
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- Cherchye, Laurens & Demuynck, Thomas & De Rock, Bram & Hjertstrand, Per, 2015. "Revealed preference tests for weak separability: An integer programming approach," Journal of Econometrics, Elsevier, vol. 186(1), pages 129-141.
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- Laurens Cherchye & Thomas Demuynck & Per Hjertstrand & Bram De Rock, 2015. "Revealed preference tests for weak separability: An integer programming approach," ULB Institutional Repository 2013/251996, ULB -- Universite Libre de Bruxelles.
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- Alarie, Y. & Bronsard, C. & Ouellette, P., 1988. "Preferences and Normal Goods : a Necessary and Sufficient Condition," Cahiers de recherche 8815, Universite de Montreal, Departement de sciences economiques.
- Alarie, Y. & Bronsard, C. & Ouellette, P., 1988. "Preferences And Normal Goods : A Necessary And Sufficient Condition," Cahiers de recherche 8815, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
- Andreu Mas-Colell, 1978. "On Revealed Preference Analysis," Review of Economic Studies, Oxford University Press, vol. 45(1), pages 121-131.
- Diewert, W. E. & Parkan, C., 1985. "Tests for the consistency of consumer data," Journal of Econometrics, Elsevier, vol. 30(1-2), pages 127-147.
- Richard Blundell & Xiaohong Chen & Dennis Kristensen, 2007. "Semi-Nonparametric IV Estimation of Shape-Invariant Engel Curves," Econometrica, Econometric Society, vol. 75(6), pages 1613-1669, November.
- James Andreoni & John Miller, 2002. "Giving According to GARP: An Experimental Test of the Consistency of Preferences for Altruism," Econometrica, Econometric Society, vol. 70(2), pages 737-753, March.
- Fisher, Franklin M., 1990. "Normal goods and the expenditure function," Journal of Economic Theory, Elsevier, vol. 51(2), pages 431-433, August. Full references (including those not matched with items on IDEAS)
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