Threshold Luce rules
Cahiers de recherche from Universite de Montreal, Departement de sciences economiques
In the late 1950's, Luce proposed two different theories of imperfect utility discrimination that have had a lasting impact on economics. One model (1956) gave rise to the literature on just noticeable differences while the other (1959) laid the foundations for the literature on discrete choice. In this paper, I present a unified model of imperfect utility discrimination that generalizes Luce's two models; and addresses the main limitations of each. Surprisingly, choice behavior consistent with this model is characterized by two conditions from Luce's monograph (1959).
Keywords: Just noticeable difference; semi-order; Luce choice axiom; strict utility model; imperfect utility discrimination (search for similar items in EconPapers)
JEL-codes: D01 D03 (search for similar items in EconPapers)
Pages: 35 pages
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Working Paper: Threshold Luce Rules (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:mtl:montde:2018-17
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