Revealed group preferences on non-convex choice problems

Efe A. Ok, Lin Zhou

    Research output: Contribution to journalArticle

    Abstract

    This paper studies the conditions under which the basic results of the revealed preference theory can be established on the domain of choice problems which include non-convex feasible sets; the exercise is closely related to the works of Peters and Wakker (1991) and Bossert (1994). We show that while no continuous choice function can satisfy strong Pareto optimality over the class of all compact and comprehensive choice problems, strong Pareto optimality, Arrow's choice axiom, upper hemicontinuity and a weak compromisation postulate turn out to be necessary and sufficient to represent choice correspondences by continuous, strictly increasing and quasiconcave real-valued functions. Some applications of our main findings to axiomatic bargaining theory are also studied.

    Original languageEnglish (US)
    Pages (from-to)671-687
    Number of pages17
    JournalEconomic Theory
    Volume13
    Issue number3
    DOIs
    StatePublished - 1999

    Keywords

    • Axiomatic bargaining theory
    • Non-convex choice problems
    • Rational choice

    ASJC Scopus subject areas

    • Economics and Econometrics

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