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On Behavioral Complementarity and its Implications


  • Christopher P. Chambers

    () (Division of the Humanities and Social Sciences, California Institute of Technology)

  • Federico Echenique

    () (Division of the Humanities and Social Sciences, California Institute of Technology)

  • Eran Shmaya

    () (Division of the Humanities and Social Sciences, California Institute of Technology)


We study the behavioral definition of complementary goods: if the price of one good increases, demand for a complementary good must decrease. We obtain its full implications for observable demand behavior (its testable implications), and for the consumer's underlying preferences. We characterize those data sets which can be generated by rational preferences exhibiting complementarities. In a model in which income results from selling an endowment (as in general equilibrium models of exchange economies), the notion is surprisingly strong and is essentially equivalent to Leontief preferences. In the model of nominal income, the notion describes a class of preferences whose extreme cases are Leontief and Cobb-Douglas respectively.

Suggested Citation

  • Christopher P. Chambers & Federico Echenique & Eran Shmaya, 2007. "On Behavioral Complementarity and its Implications," Documentos de Trabajo (working papers) 1007, Department of Economics - dECON.
  • Handle: RePEc:ude:wpaper:1007

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    References listed on IDEAS

    1. Varian, Hal R, 1982. "The Nonparametric Approach to Demand Analysis," Econometrica, Econometric Society, vol. 50(4), pages 945-973, July.
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    Cited by:

    1. Cherchye, Laurens & Demuynck, Thomas & De Rock, Bram, 2018. "Normality of demand in a two-goods setting," Journal of Economic Theory, Elsevier, vol. 173(C), pages 361-382.

    More about this item


    Afriat's Theorem; Weak Axiom of Revealed Preference; Complementary goods.;

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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