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Econometrica Vol. 44 No. 5 1976

The Demand Theory of the Weak Axiom of Revealed Preference

Richard Kihlstrom1,2; Andreu Mas-Colell; Hugo Sonnenschein

1 Kellogg's (Canada) · 2 Science North

Abstract

In this paper we provide a statement of the relationship between the weak axiom of revealed preference (WA) and the negative semidefiniteness of the matrix of substitution terms (NSD). As a corollary we determine the relation between WA and the strong axiom of revealed preference (SA). The latter is equivalent to NSD and the symmetry of the matrix of substitution terms. The former, WA, implies NSD but is not implied by NSD. Also, WA is implied by the condition that the matrix of substitution terms is negative definite (ND), but it does not imply ND. Application of these results yield an infinity of demand functions which satisfy WA but not SA.

DOI
10.2307/1911539
Volume
44
Issue
5
Pages
971
Sources
bibtex:phds-export.bib openalex crossref

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