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A canon of probabilistic rationality

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  • Cerreia-Vioglio, Simone
  • Lindberg, Per Olov
  • Maccheroni, Fabio
  • Marinacci, Massimo
  • Rustichini, Aldo

Abstract

We prove that a random choice rule satisfies Luce's Choice Axiom if and only if its support is a choice correspondence that satisfies the Weak Axiom of Revealed Preference, thus it consists of alternatives that are optimal according to some preference, and then random choice occurs according to a tie-breaking mechanism among such alternatives that satisfies Renyi's Conditioning Axiom.

Suggested Citation

  • Cerreia-Vioglio, Simone & Lindberg, Per Olov & Maccheroni, Fabio & Marinacci, Massimo & Rustichini, Aldo, 2021. "A canon of probabilistic rationality," Journal of Economic Theory, Elsevier, vol. 196(C).
    • Handle: RePEc:eee:jetheo:v:196:y:2021:i:c:s002205312100106x
    DOI: 10.1016/j.jet.2021.105289
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    8. Doğan, Serhat & Yıldız, Kemal, 2021. "Odds supermodularity and the Luce rule," Games and Economic Behavior, Elsevier, vol. 126(C), pages 443-452.
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    Cited by:

    1. Faro, José Heleno, 2023. "The Luce model with replicas," Journal of Economic Theory, Elsevier, vol. 208(C).
    2. Makoto Hagiwara, 2024. "The focal Luce model with status Quo," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 12(1), pages 107-117, June.
    3. Jose A. Rodrigues-Neto & Matthew Ryan & James Taylor, 2024. "A stricter canon: general Luce models for arbitrary menu sets," Working Papers 2024-04, Auckland University of Technology, Department of Economics.

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    More about this item

    Keywords

    Random choice; Weak axiom of revealed preferences; Choice axiom;
    All these keywords.

    JEL classification:

    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • D1 - Microeconomics - - Household Behavior
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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