BibTeX
@MISC{Sákovics12revealedcardinal,
author = {József Sákovics},
title = {Revealed cardinal preference},
year = {2012}
}
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Abstract
I prove that as long as we allow the marginal utility for money () to vary between purchases (similarly to the budget) then the quasi-linear and the ordinal budget-constrained models rationalize the same data on consumer purchases. However, in the short run is approximately constant. I provide a simple constructive proof for the necessary and sufficient condition for the constant rationalization, which I argue should replace the Generalized Axiom of Revealed Preference in empirical studies of con-
