IDEAS home Printed from
   My bibliography  Save this paper

Stochastic demand correspondences and their aggregation properties


  • J. C. R. Alcantud

    (Universidad de Salamanca)


Bandyopadhyay, Dasgupta and Pattanaik [JET, 2002] have presented a construction that aggregates standard demand functions by a stochastic demand function, in such way that the latter satisfies the weak axiom of stochastic revealed preference when the former full Samuelson's weak axiom of revealed preference. We introduce a concept of stochastic demand correspondences and generalize WASRP to this new setting. Also, we propose a procedure to aggregate stochastic demand correspondences that (a) includes the previous one by those authors, (b) aggregates the weak axiom of stochastic revealed preference (and thus stochastic substitutability when we started with tight stochastic demand func- tions), and (c) produces a stochastically rational stochastic demand correspondence when the primitive ones are stochastically rational. Interpretations of the model are provided too. An analogous to the result that rationalizability of stochastic demand functions by stochastic orderings implies WASRP holds for the correspondence setting. We also dis- cuss the convenience of adopting a formal variation of the notion of being stochastically rational that was proposed in the literature.

Suggested Citation

  • J. C. R. Alcantud, 2005. "Stochastic demand correspondences and their aggregation properties," Microeconomics 0501004, EconWPA.
  • Handle: RePEc:wpa:wuwpmi:0501004
    Note: Type of Document - pdf; pages: 15

    Download full text from publisher

    File URL:
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    1. E. Eisenberg, 1961. "Aggregation of Utility Functions," Management Science, INFORMS, vol. 7(4), pages 337-350, July.
    2. Shafer, Wayne J, 1977. "Revealed Preference and Aggregation," Econometrica, Econometric Society, vol. 45(5), pages 1173-1182, July.
    3. Barbera, Salvador & Pattanaik, Prasanta K, 1986. "Falmagne and the Rationalizability of Stochastic Choices in Terms of Random Orderings," Econometrica, Econometric Society, vol. 54(3), pages 707-715, May.
    4. Bandyopadhyay, Taradas & Bandyopadhyay, Bandyopadhyay & Pattanaik, Prasanta K., 2002. "Demand Aggregation and the Weak Axiom of Stochastic Revealed Preference," Journal of Economic Theory, Elsevier, vol. 107(2), pages 483-489, December.
    5. Bandyopadhyay, Taradas & Dasgupta, Indraneel & Pattanaik, Prasanta K., 1999. "Stochastic Revealed Preference and the Theory of Demand," Journal of Economic Theory, Elsevier, vol. 84(1), pages 95-110, January.
    6. Chipman, John S., 1974. "Homothetic preferences and aggregation," Journal of Economic Theory, Elsevier, vol. 8(1), pages 26-38, May.
    7. Taradas Bandyopadhyay & Indraneel Dasgupta & Prasanta Pattanaik, 2004. "A general revealed preference theorem for stochastic demand behavior," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 23(3), pages 589-599, March.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Dasgupta Indraneel & Pattanaik P. K, 2010. "Revealed Preference with Stochastic Demand Correspondence," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 10(1), pages 1-21, August.

    More about this item

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D2 - Microeconomics - - Production and Organizations
    • D3 - Microeconomics - - Distribution
    • D4 - Microeconomics - - Market Structure, Pricing, and Design

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpmi:0501004. 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: (EconWPA). General contact details of provider: .

    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 CitEc recognized a reference but did not link an item in RePEc 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 RePEc Author Service 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.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.