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Identifying Restrictions on the Random Utility Model

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  • Peter P. Caradonna
  • Christopher Turansick

Abstract

We characterize those ex-ante restrictions on the random utility model which lead to identification. We first identify a simple class of perturbations which transfer mass from a suitable pair of preferences to the pair formed by swapping certain compatible lower contour sets. We show that two distributions over preferences are behaviorally equivalent if and only if they can be obtained from each other by a finite sequence of such transformations. Using this, we obtain specialized characterizations of which restrictions on the support of a random utility model yield identification, as well as of the extreme points of the set of distributions rationalizing a given data set. Finally, when a model depends smoothly on some set of parameters, we show that under mild topological assumptions, identification is characterized by a straightforward, local test.

Suggested Citation

  • Peter P. Caradonna & Christopher Turansick, 2024. "Identifying Restrictions on the Random Utility Model," Papers 2408.06547, arXiv.org.
  • Handle: RePEc:arx:papers:2408.06547
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