SFB 303 Discussion Paper No. A-528

Author: Sippel, Reinhard

Title: A Note on the Power of Revealed Preference Tests with Afriat Inefficiency

Abstract: We show that revealed preference tests, which allow a small degree of inefficiency in consumers' choices, have no power against the alternative of purely random demand.

Keywords: revealed preference tests, Afriat efficiency index, nearly optimizing

JEL-Classification-Number: C12, C15, D12

Creation-Date: July 1996
URL: ../1996/a/bonnsfa528.pdf

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