Template-Type: ReDIF-Paper 1.0
Title: Gross Substitutability and the Weak Axiom of Revealed Preference
Author-Name: Timothy J. Kehoem

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Abstract: This paper investigates the relationship between gross substitutability 
 and the weak axiom of revealed preference in excess demand functions. Gross 
 substitutability implies the weak axiom when the number of goods, n, is 
 less than four. There are robust counterexamples to this proposition when 
 n>or=4. Nonetheless, Monte Carlo experiments indicate that violations of the 
 weak axiom are extremely rare in functions that satisfy gross substitutability. 
 They also reveal, however, a new class of demand function that violates the 
 weak axiom. These results are of interest because of the close relationship 
 of the weak axiom to uniqueness of equilibrium in production economies.
Series: Sonderforschungsbereich 303, University of Bonn, Germany

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Creation-Date: 1989-09
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Handle: RePEc:bon:bonsfa:258