Rational choice with full-comparability domains

Bruno A. Furtado, Leandro Nascimento and Gil Riella

Journal of Economic Behavior & Organization, 2023, vol. 216, issue C, 124-135

Abstract: We propose a new model of choice in the presence of incomplete preferences. Instead of simply choosing an element which is maximal according to her preferences, the decision maker divides the space of alternatives into subdomains inside which her preferences are complete. She then maximizes her preferences inside these domains of full comparability. Representation theorems are given in which the decision maker always satisfies a weaker form of the Weak Axiom of Revealed Preference and different postulates are imposed on a general notion of revealed preference. They identify a class of choice correspondences that is nested between choice correspondences represented by multiple rationales and the standard model of rational choice. In addition, we suggest that our results provide a useful tool to adapt models that were otherwise restricted to deterministic choice to the setup of stochastic choice.

Keywords: Choice with categories; Revealed preference relation; Choice correspondences; Incomplete preferences; Linking deterministic and stochastic choice; Consideration sets (search for similar items in EconPapers)
JEL-codes: D01 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:216:y:2023:i:c:p:124-135

DOI: 10.1016/j.jebo.2023.10.010

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