Author
Iehlé, Vincent
Forges, Françoise
Type
Document de travail / Working paper
Abstract (EN)
Given budget sets and consumer's consumption bundles, the economist deduces essential
budgetary information, namely, whether every consumption bundle is available in every
budget set and whether it exhausts the consumer's revenue. We show that rationalization of
the original data is equivalent to the existence of budget sets compatible with the essential
data together with a utility function rationalizing these budget sets. Hence the conclusion
of the original rationalizability test automatically applies to a whole class of budget sets.
Furthermore, in case of a positive answer, a single utility function, which rationalizes at once
almost all compatible budget sets, can be constructed.