Skip to main content

How Demanding Is the Revealed Preference Approach to Demand?

Buy Article:

$19.00 plus tax (Refund Policy)

Abstract:

A well-known problem with revealed preference methods is that when data are found to satisfy their restrictions it is hard to know whether this should be viewed as a triumph for economic theory, or a warning that these conditions are so undemanding that almost anything goes. This paper allows researchers to make this distinction. Our approach uses an axiomatic characterization of a measure of predictive success due to Selten (1991). We illustrate the idea using a panel dataset. The results show that this approach can lead us to radically reassess our view of the empirical performance of economic theory.

Document Type: Research Article

DOI: http://dx.doi.org/10.1257/aer.101.6.2782

Publication date: October 1, 2011

More about this publication?
aea/aer/2011/00000101/00000006/art00017
dcterms_title,dcterms_description,pub_keyword
6
5
20
40
5

Access Key

Free Content
Free content
New Content
New content
Open Access Content
Open access content
Subscribed Content
Subscribed content
Free Trial Content
Free trial content
Cookie Policy
X
Cookie Policy
ingentaconnect website makes use of cookies so as to keep track of data that you have filled in. I am Happy with this Find out more