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Revealed Preference and Choice under Uncertainty

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  • BOSSERT, Walter
  • SUZUMURA, Kotaro

Abstract

We employ the theory of rational choice to examine whether observable choices from feasible sets of prospects can be generated by the optimization of some underlying decision criterion under uncertainty. Rather than focusing on a specific theory of choice, our objective is to formulate a general approach that is designed to cover the various decision criteria that have been proposed in the literature. We use a mild dominance property to define a class of suitable choice criteria. In addition to rationalizability per se, we characterize transitive and Suzumura consistent rationalizability in the presence of dominance.

Suggested Citation

  • BOSSERT, Walter & SUZUMURA, Kotaro, 2010. "Revealed Preference and Choice under Uncertainty," Cahiers de recherche 21-2010, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
    • Handle: RePEc:mtl:montec:21-2010
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    References listed on IDEAS

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    1. Barbera, S. & Barrett, C. R. & Pattanaik, Prasanta K., 1984. "On some axioms for ranking sets of alternatives," Journal of Economic Theory, Elsevier, vol. 33(2), pages 301-308, August.
    2. Walter Bossert & Yves Sprumont & Kotaro Suzumura, 2005. "Consistent Rationalizability," Economica, London School of Economics and Political Science, vol. 72(286), pages 185-200, May.
    3. Suzumura, Kotaro, 1977. "Houthakker's axiom in the theory of rational choice," Journal of Economic Theory, Elsevier, vol. 14(2), pages 284-290, April.
    4. Kotaro Suzumura, 1976. "Rational Choice and Revealed Preference," Review of Economic Studies, Oxford University Press, vol. 43(1), pages 149-158.
    5. Gardenfors, Peter, 1976. "Manipulation of social choice functions," Journal of Economic Theory, Elsevier, vol. 13(2), pages 217-228, October.
    6. Bossert, Walter & Suzumura, Kotaro, 2010. "Consistency, Choice, and Rationality," Economics Books, Harvard University Press, number 9780674052994, Spring.
    7. Barbera, Salvador & Pattanaik, Prasanta K., 1984. "Extending an order on a Set to the power set: Some remarks on Kannai and Peleg's approach," Journal of Economic Theory, Elsevier, vol. 32(1), pages 185-191, February.
    8. Kannai, Yakar & Peleg, Bezalel, 1984. "A note on the extension of an order on a set to the power set," Journal of Economic Theory, Elsevier, vol. 32(1), pages 172-175, February.
    9. Suzumura, Kataro, 1976. "Remarks on the Theory of Collective Choice," Economica, London School of Economics and Political Science, vol. 43(172), pages 381-390, November.
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    Cited by:

    1. Hiroki Nishimura & Efe A. Ok & John K.-H. Quah, 2017. "A Comprehensive Approach to Revealed Preference Theory," American Economic Review, American Economic Association, vol. 107(4), pages 1239-1263, April.

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    More about this item

    Keywords

    uncertainty; prospects; rational choice; decision theory;
    All these keywords.

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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