Nonparametric tests of collectively rational consumption behavior: an integer programming procedure

Laurens Cherchye, Bram De Rock, Jeroen Sabbe () and Frederic Vemeulen

Working Papers of Department of Economics, Leuven from KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven

Abstract: We present an IP-based nonparametric (revealed preference) testing procedure for rational consumption behavior in terms of general collective models, which include consumption externalities and public consumption. An empirical application to data drawn from the Russia Longitudinal Monitoring Survey (RLMS) demonstrates the practical usefulness of the procedure. Finally, we present extensions of the testing procedure to evaluate the goodness-of-fit of the collective model subject to testing, and to quantify and improve the power of the corresponding collective rationality tests.

Keywords: collective consumption model; revealed preferences; nonparametric rationality tests; integer programming (IP). (search for similar items in EconPapers)
JEL-codes: C14 D11 D12 (search for similar items in EconPapers)
Date: 2008-03
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Nonparametric tests of collectively rational consumption behavior: An integer programming procedure (2008)
Working Paper: Nonparametric tests of collectively rational consumption behavior: an integer programming procedure (2008)
Working Paper: Nonparametric Tests of Collectively Rational Consumption Behavior: An Integer Programming Procedure (2008)
Working Paper: Nonparametric Tests of Collectively Rational Consumption Behavior: An Integer Programming Procedure (2008)
Working Paper: Nonparametric tests of collectively rational consumption behavior: an integer programming procedure (2008)
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