Representation Theorems for Path-Independent Choice Rules

Authors: Koji Yokote, Isa Hafalir, Fuhito Kojima, M. Bumin Yenmez

Date of publication: March 2023

Working paper number: 01

Abstract: 

Path independence is arguably one of the most important choice rule properties in economic theory. We show that a choice rule is path independent if and only if it is rationalizable by a utility function satisfying ordinal concavity, a concept closely related to concavity notions in discrete mathematics. We also provide a representation result for choice rules that satisfy path independence and the law of aggregate demand.

Keywords: Rationality, representation theorems, ordinal concavity, path independence, law of aggregate demand, discrete convex analysis
 

Acknowledgement of Country

UTS acknowledges the Gadigal people of the Eora Nation, the Boorooberongal people of the Dharug Nation, the Bidiagal people and the Gamaygal people, upon whose ancestral lands our university stands. We would also like to pay respect to the Elders both past and present, acknowledging them as the traditional custodians of knowledge for these lands.