Two new proofs of Afriat's theorem

A. Fostel (ana.fostelyale.edu)
H.E. Scarf (herbert.scarfyale.edu)
M.J. Todd ( miketoddcs.cornell.edu)

Abstract: We provide two new, simple proofs of Afriat's celebrated theorem stating that a finite set of price-quantity observations is consistent with utility maximization if, and only if, the observations satisfy a variation of the Strong Axiom of Revealed Preference known as the Generalized Axiom of Revealed Preference.

Keywords: utility maximization, revealed preference, linear programming

Category 1: Applications -- OR and Management Sciences (Finance and Economics )

Category 2: Linear, Cone and Semidefinite Programming (Linear Programming )

Category 3: Combinatorial Optimization (Graphs and Matroids )

Citation: Technical Report No. 1381, School of Operations Research and Industrial Engineering, Cornell University.

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Entry Submitted: 11/06/2003
Entry Accepted: 11/06/2003
Entry Last Modified: 11/06/2003

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