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Testable Implications of Translation Invariance and Homotheticity: Variational, Maxmin, CARA and CRRA preferences

Chambers, Christopher P. and Echenique, Federico and Saito, Kota (2015) Testable Implications of Translation Invariance and Homotheticity: Variational, Maxmin, CARA and CRRA preferences. Social Science Working Paper, 1401. California Institute of Technology , Pasadena, CA. http://resolver.caltech.edu/CaltechAUTHORS:20160308-151531257

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Abstract

We provide revealed preference axioms that characterize models of translation invariant preferences. In particular, we characterize the models of variational, maxmin, CARA and CRRA utilities. In each case we present a revealed preference axiom that is satisfied by a dataset if and only if the dataset is consistent from the corresponding utility representation. Our results complement traditional exercises in decision theory that take preferences as primitive.


Item Type:Report or Paper (Working Paper)
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http://resolver.caltech.edu/CaltechAUTHORS:20160329-072655949Related ItemPNAS article
Additional Information:January 2015. We are very grateful to Simon Grant and Massimo Marinacci, who posed questions to us that led to some of the results in this paper.
Group:Social Science Working Papers
Subject Keywords:Variational preferences; Maxmin Utility; CARA; CRRA; Revealed Preference; Testable Implications
Classification Code:JEL classification numbers: D81, D11
Record Number:CaltechAUTHORS:20160308-151531257
Persistent URL:http://resolver.caltech.edu/CaltechAUTHORS:20160308-151531257
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:65221
Collection:CaltechAUTHORS
Deposited By: Katherine Johnson
Deposited On:08 Mar 2016 23:23
Last Modified:06 Apr 2016 22:20

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