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Testing Consumer Theory: Evidence From a Natural Field Experiment

Maja Adena (), Steffen Huck () and Imran Rasul ()

No 54, Rationality and Competition Discussion Paper Series from CRC TRR 190 Rationality and Competition

Abstract: We present evidence from a natural field experiment designed to shed light on whether individual behavior is consistent with a neoclassical model of utility maximization subject to budget constraints. We do this through the lens of a field experiment on charitable giving. We find that the behavior of at least 80% of individuals, on both the extensive and intensive margins, can be rationalized within a standard neoclassical choice model in which individuals have preferences, defined over own consumption and their contribution towards the charitable good, satisfying the axioms of revealed preference.

Keywords: natural field experiment; revealed preference (search for similar items in EconPapers)
JEL-codes: C93 D01 D12 D64 (search for similar items in EconPapers)
Date: 2017-11-02
New Economics Papers: this item is included in nep-cbe, nep-exp and nep-upt
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