Are People Maximizing an Incomplete Preference?

Daniel O. Cajueiro and Mauricio Ribeiro

Bristol Economics Discussion Papers from School of Economics, University of Bristol, UK

Abstract: We study how to test whether choices are compatible with maximizing an incomplete preference when we cannot choose the menus from which to observe choices, both theoretically and empirically. Theoretically, we contrast the testable restrictions of the complete and incomplete preference maximization models, showing that once we drop completeness, testing for compatibility becomes computationally hard and may even require an infinite dataset. Empirically, we propose a toolkit to test for compatibility with maximizing an incomplete preference, addressing cases where the analyst might only observe some of the choices a person would make from a menu. We apply this toolkit to compare the performance of the complete and incomplete preference maximization models in three existing choice experiments.

Date: 2025-04-02
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Persistent link: https://EconPapers.repec.org/RePEc:bri:uobdis:25/806

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