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STICERD Economic Theory Seminars

Revealed Statistical Consumer Theory

John Rehbeck (Ohio State University)

Thursday 11 March 2021 15:30 - 17:00

Due to the onging coronavirus outbreak, many of our seminars and public events this year will continue as online seminars. Please check our website listings and Twitter feed @STICERD_LSE for updates.


About this event

We provide a microfoundation for using aggregated data (e.g. mean purchases) when evaluating consumer choice data. We present a model of statistical consumer theory where the individual maximizes their utility with respect to a distribution of bundles that is constrained by a statistic of the distribution (e.g. mean expenditure). We show that this behavior is observationally equivalent to an individual whose preferences depend only on the statistic of the distribution. This means that despite working with distributions, the empirical content of the model only depends on a finite-dimensional statistic. Statistical consumer theory neither nests nor is nested in the random utility approach. We show this approach generalizes quasilinear utility with random preferences and income, mean-variance preferences, and preferences that depend on arbitrary moments.

Economic Theory Seminars are held on Thursdays in term time at 15:30-17:00, ONLINE, unless specified otherwise.

Seminar organisers: Dr Andrew Ellis and Dr Francesco Nava.

For further information please contact Annie-Rose Nicholas by email: a.nicholas1@lse.ac.uk.

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