Completing incomplete preferences

Jianying Qiu

MPRA Paper from University Library of Munich, Germany

Abstract: We propose a model for individuals who have incomplete preferences and attempt to complete them. We show that two empirical puzzles ‑ the willingness-to-pay and willingness-to-ask (WTP-WTA) gap as well as the present bias ‑ arise naturally in the process of completing incomplete preferences. Based on the model, an incentive-compatible mechanism to measure the incompleteness in preferences is developed. An experimental implementation of the measurement mechanism provides results consistent with our model.

Keywords: incomplete preferences; incentive-compatible measurement mechanism; experiments; the incompleteness in preferences (search for similar items in EconPapers)
JEL-codes: B40 C91 D81 (search for similar items in EconPapers)
Date: 2015-03-08, Revised 2016-07-18
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:91692

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