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The Axiomatic Structure of Empirical Content
 American Economic Review
, 2014
"... Abstract. In this paper, we provide a formal framework for studying the empirical content of a given theory. We define the falsifiable closure of a theory T with respect to T to be the largest subtheory of T with respect to which T cannot be falsified with a finite data set. We provide a syntactic ..."
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Abstract. In this paper, we provide a formal framework for studying the empirical content of a given theory. We define the falsifiable closure of a theory T with respect to T to be the largest subtheory of T with respect to which T cannot be falsified with a finite data set. We provide a syntactic characterization of the falsifiable closure operator, showing it is equivalent to the theory which is axiomatized by all sentences satisfied by T which are universal negations of conjunctions of atomic formulas (UNCA). We also show that it is the smallest subtheory of T containing T all of whose predictions are empirically falsifiable. Lastly, the falsifiable closure operator has the structure of a topological closure. The ideas here are useful for understanding theories which are wellunderstood (for example, we describe Afriat's theorem in our context), but they can also be applied to theories with no known axiomatization. We show, for example, that the theory of multiple selves with a fixed finite set of agents (where multiple selves are aggregated according to a neutral preference aggregation rule satisfying independence of irrelevant alternatives), is a falsifiably complete theory (for any neutral rule satisfying IIA).
Ordinal relative satis cing behavior
, 2015
"... Abstract: We propose a notion of rrationality, a relative version of satis
cing behavior based on the idea that, for any set of available alternatives, individuals choose one of their rbest according to a single preference order. We fully characterize the choice functions satisfying the condition f ..."
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Abstract: We propose a notion of rrationality, a relative version of satis
cing behavior based on the idea that, for any set of available alternatives, individuals choose one of their rbest according to a single preference order. We fully characterize the choice functions satisfying the condition for any r, and provide an algorithm to compute the maximal degree of rrationality associated with any given choice function. The notion is extended to individuals whose r may vary with the set of available alternatives. Special cases of ordinal relative satis
cing behavior result from a variety of choice models proposed in the literature. Journal of Economic Literature Classi
cation Numbers: D71.
Reasonbased choice and contextdependence: An
, 2015
"... We introduce a “reasonbased ” framework for explaining and predicting individual choices. It captures the idea that a decisionmaker focuses on some but not all properties of the options and chooses an option whose motivationally salient properties he/she most prefers. Reasonbased explanations al ..."
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We introduce a “reasonbased ” framework for explaining and predicting individual choices. It captures the idea that a decisionmaker focuses on some but not all properties of the options and chooses an option whose motivationally salient properties he/she most prefers. Reasonbased explanations allow us to distinguish between two kinds of contextdependent choice: the motivationally salient properties may (i) vary across choice contexts, and (ii) include not only “intrinsic ” properties of the options, but also “contextrelated ” properties. Our framework can accommodate boundedly rational and sophisticatedly rational choice. Since properties can be recombined in new ways, it also o↵ers resources for predicting choices in unobserved contexts.
unknown title
"... Revealed preference is one of the most influential ideas in economics and has been applied to a number of areas of economics, including consumer theory.1 According to standard revealed preference theory, x is revealed to be preferred to y if and only if x is chosen when y is also available (Samuelso ..."
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Revealed preference is one of the most influential ideas in economics and has been applied to a number of areas of economics, including consumer theory.1 According to standard revealed preference theory, x is revealed to be preferred to y if and only if x is chosen when y is also available (Samuelson 1938). Any choice reversal, therefore, observed both empirically and experimentally, is attributed to irrationality since it cannot be expressed as a preference maximization. The revealed preference argument relies on the implicit assumption that a decision maker (DM) considers all feasible alternatives. Without the full consideration assumption, the standard revealed preference method can be misleading. It is possible that the DM prefers x to y but she chooses y when x is present simply because she does not realize that x is also available (Hausman 2008). For example, while using a search engine, a DM might only pay attention to alternatives appearing on the first page of the results since it takes too much time to consider all the search results. She then picks the best alternative of those on the first page, say y. It is possible that her most preferred item, x, does not appear on the first page. Therefore we, as outside observers, cannot conclude that y is better than x even though y is chosen when x is 1 Varian (2006) provides a nice survey of revealed preference analysis. Revealed Attention†