Abstract
We employ the theory of rational choice to examine whether observable choices from feasible sets of prospects can be generated by the optimization of some underlying decision criterion under uncertainty. Rather than focusing on a specific theory of choice, our objective is to formulate a general approach that is designed to cover the various decision criteria that have been proposed in the literature. We use a mild dominance property to define a class of suitable choice criteria. In addition to rationalizability per se we characterize transitive and Suzumura consistent rationalizability in the presence of dominance.
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This paper is dedicated to Salvador Barberà in appreciation of his invaluable contribution to the academic community in general and to the group of economic theorists in particular. We thank a referee for her or his extremely thoughtful comments and suggestions. Financial support from a Grant-in-Aid for Specially Promoted Research from the Ministry of Education, Culture, Sports, Science and Technology of Japan for the Project on Economic Analysis of Intergenerational Issues (grant number 22000001), the Fonds de Recherche sur la Société et la Culture of Québec and the Social Sciences and Humanities Research Council of Canada is gratefully acknowledged.
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Bossert, W., Suzumura, K. Revealed preference and choice under uncertainty. SERIEs 3, 247–258 (2012). https://doi.org/10.1007/s13209-011-0044-9
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DOI: https://doi.org/10.1007/s13209-011-0044-9