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Supermodularizability

Chambers, Christopher P. and Echenique, Federico (2006) Supermodularizability. Social Science Working Paper, 1248. California Institute of Technology , Pasadena, CA. (Unpublished) http://resolver.caltech.edu/CaltechAUTHORS:20170802-103018989

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Abstract

We study the ordinal content of assuming supermodularity, including conditions under which a binary relation can be represented by a supermodular function. When applied to revealed-preference relations, our results imply that supermodularity is some times not refutable: A consumer’s choices can be rationalized with a supermodular utility function if they can be rationalized with a monotonic utility function. Hence, supermodularity is not empirically distinguishable from monotonicity. We present applications to assortative matching, decision under uncertainty, and to testing production technologies.


Item Type:Report or Paper (Working Paper)
Group:Social Science Working Papers
Subject Keywords:Supermodular, Quasisupermodular, Afriat's Theorem, Assortative Matching, Uncertainty Aversion, Choquet Expected Utility
Classification Code:JEL: D11, D24, C78
Record Number:CaltechAUTHORS:20170802-103018989
Persistent URL:http://resolver.caltech.edu/CaltechAUTHORS:20170802-103018989
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:79750
Collection:CaltechAUTHORS
Deposited By: Hanna Storlie
Deposited On:02 Aug 2017 17:46
Last Modified:02 Aug 2017 17:46

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