Computing revealed preference goodness-of-fit measures with integer programming

Thomas Demuynck and John Rehbeck ()
Additional contact information
John Rehbeck: The Ohio State University

Economic Theory, 2023, vol. 76, issue 4, No 5, 1175-1195

Abstract: Abstract This paper develops mixed integer linear programming (MILP) formulations to compute various revealed preference goodness-of-fit measures. We provide MILP formulations to compute the Houtman–Maks index, the average Varian index, and the minimum cost index when there are linear budgets. Next, we provide MILPs to compute minimal “measurement error” in expenditures, prices, and quantities. Finally, we extend our results to non-linear budgets. As a proof of concept, we compute various goodness-of-fit measures for experimental choice data sets from the literature. The maximal computation time is less than 3 s for all measures examined on these datasets.

Keywords: Revealed preference; Choice consistency; Computation (search for similar items in EconPapers)
JEL-codes: D1 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://link.springer.com/10.1007/s00199-023-01489-x Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
Working Paper: Computing Revealed Preference Goodness of fit Measures with Integer Programming (2023)
Working Paper: Computing Revealed Preference Goodness of fit Measures with Integer Programming (2021)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:joecth:v:76:y:2023:i:4:d:10.1007_s00199-023-01489-x

Ordering information: This journal article can be ordered from
http://www.springer. ... eory/journal/199/PS2

DOI: 10.1007/s00199-023-01489-x

Access Statistics for this article

Economic Theory is currently edited by Nichoals Yanneils

More articles in Economic Theory from Springer, Society for the Advancement of Economic Theory (SAET) Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().