Consumer Choice Theory and Social Learning
In this paper we formalize learning as a determinant of individual choice. We model economic agent as an individual who makes her choice according to a specific set of experiences, which evolves over time as the agent learns from both her personal history and her social environment. We link preferences to choices through the notion of hierarchy of wants. We present an axiomatic characterization, inspired by Georgescu-Roegen (1950, 1954), of the individual choice mechanism in a social environment. Following these axioms, we show that an agent may change her choice from one period to another and remain nonetheless rational. The learning mechanism allows for the modification of individual preference ordering over time as well as it implies irreversibility, in the sense that economic changes leave a mark in the decision making process.
|Date of creation:||Apr 2014|
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- Cynamon Barry Z. & Fazzari Steven M., 2008. "Household Debt in the Consumer Age: Source of Growth--Risk of Collapse," Capitalism and Society, De Gruyter, vol. 3(2), pages 1-32, October.
- Alan Kirman & Miriam Teschl, 2006. "Searching for identity in the capability space," Journal of Economic Methodology, Taylor & Francis Journals, vol. 13(3), pages 299-325.
- Dietrich, Franz & List, Christian, 2010.
"Where do preferences come from?,"
36115, University Library of Munich, Germany, revised 2011.
- Dietrich Franz & List Christian, 2011. "Where do preferences come from?," Research Memorandum 005, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
- Franz Dietrich & Christian List, 2010. "Where do preferences come from?," Levine's Working Paper Archive 661465000000001137, David K. Levine.
- Gowdy, John M. & Mayumi, Kozo, 2001. "Reformulating the foundations of consumer choice theory and environmental valuation," Ecological Economics, Elsevier, vol. 39(2), pages 223-237, November.
- George A. Akerlof, 2007. "The Missing Motivation in Macroeconomics," American Economic Review, American Economic Association, vol. 97(1), pages 5-36, March.
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