IDEAS home Printed from https://ideas.repec.org/p/zbw/ifwedp/201232.html
   My bibliography  Save this paper

Experimental test of utility maximization

Author

Listed:
  • He, Yuqing

Abstract

The study tests the cardinal utility maximization hypothesis by an experimental procedure in a framework of utility scaling approach following the psychophysical-econometric paradigm, conceived in He (Psychophysical Interpretation for Utility Measures, 2011). It reveals (i) the utility maximization can be tested and has been supported by experimental results; (ii) the utility scaling approach following the psychophysical econometric paradigm offers a new foundation to discuss the utility concept; and (iii) it is necessary to distinguish the perception utility and emotion utility to respectively describe economic choices and enjoyment choices.

Suggested Citation

  • He, Yuqing, 2012. "Experimental test of utility maximization," Economics Discussion Papers 2012-32, Kiel Institute for the World Economy (IfW Kiel).
    • Handle: RePEc:zbw:ifwedp:201232
    as

    Download full text from publisher

    File URL: http://www.economics-ejournal.org/economics/discussionpapers/2012-32
    Download Restriction: no
    File URL: https://www.econstor.eu/bitstream/10419/59988/1/71921291X.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Tversky, Amos & Kahneman, Daniel, 1992. "Advances in Prospect Theory: Cumulative Representation of Uncertainty," Journal of Risk and Uncertainty, Springer, vol. 5(4), pages 297-323, October.
    2. Slovic, Paul & Lichtenstein, Sarah, 1983. "Preference Reversals: A Broader Perspective," American Economic Review, American Economic Association, vol. 73(4), pages 596-605, September.
    3. George J. Stigler, 1950. "The Development of Utility Theory. I," Journal of Political Economy, University of Chicago Press, vol. 58(4), pages 307-307.
    4. Steffen Andersen & Seda Ertac & Uri Gneezy & Moshe Hoffman & John A. List, 2011. "Stakes Matter in Ultimatum Games," American Economic Review, American Economic Association, vol. 101(7), pages 3427-3439, December.
    5. K. R. MacCrimmon & M. Toda, 1969. "The Experimental Determination of Indifference Curves," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 36(4), pages 433-451.
    6. Daniel Kahneman & Peter P. Wakker & Rakesh Sarin, 1997. "Back to Bentham? Explorations of Experienced Utility," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(2), pages 375-406.
    7. repec:feb:framed:0088 is not listed on IDEAS
    8. L. R. Klein & H. Rubin, 1947. "A Constant-Utility Index of the Cost of Living," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 15(2), pages 84-87.
    9. He, Yuqing, 2011. "Psychophysical interpretation for utility measures," Economics Discussion Papers 2011-50, Kiel Institute for the World Economy (IfW Kiel).
    10. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-326, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Green, Jemma & Newman, Peter, 2017. "Citizen utilities: The emerging power paradigm," Energy Policy, Elsevier, vol. 105(C), pages 283-293.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. He, Yuqing, 2011. "Psychophysical interpretation for utility measures," Economics Discussion Papers 2011-50, Kiel Institute for the World Economy (IfW Kiel).
    2. He, Yuqing, 2012. "Psychophysical interpretation for utility measures," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 6, pages 1-35.
    3. Carter, Steven & McBride, Michael, 2013. "Experienced utility versus decision utility: Putting the ‘S’ in satisfaction," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 42(C), pages 13-23.
    4. Ulrich Witt, 2016. "The transformations of utility theory: a behavioral perspective," Journal of Bioeconomics, Springer, vol. 18(3), pages 211-228, October.
    5. Mitra, Atul & Jenkins, G. Douglas & Gupta, Nina & Shaw, Jason D., 2015. "The utility of pay raises/cuts: A simulation experimental study," Journal of Economic Psychology, Elsevier, vol. 49(C), pages 150-166.
    6. Francesco GUALA, 2017. "Preferences: Neither Behavioural nor Mental," Departmental Working Papers 2017-05, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    7. Che-Yuan Liang, 2017. "Optimal inequality behind the veil of ignorance," Theory and Decision, Springer, vol. 83(3), pages 431-455, October.
    8. Hajdu, Tamás & Hajdu, Gábor, 2011. "A hasznosság és a relatív jövedelem kapcsolatának vizsgálata magyar adatok segítségével [Examining the relation of utility and relative income using Hungarian data]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(1), pages 56-73.
    9. Manel Baucells & Silvia Bellezza, 2017. "Temporal Profiles of Instant Utility During Anticipation, Event, and Recall," Management Science, INFORMS, vol. 63(3), pages 729-748, March.
    10. Uri Gneezy & Yoram Halevy & Brian Hall & Theo Offerman & Jeroen van de Ven, 2024. "How Real is Hypothetical? A High-Stakes Test of the Allais Paradox," Working Papers tecipa-783, University of Toronto, Department of Economics.
    11. Martin Binder, 2009. "Some Considerations Regarding the Problem of Multidimensional Utility," Jena Economics Research Papers 2009-099, Friedrich-Schiller-University Jena.
    12. Edsel L. Beja, 2017. "The Asymmetric Effects of Macroeconomic Performance on Happiness: Evidence for the EU," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 52(3), pages 184-190, May.
    13. Nick Netzer, 2009. "Evolution of Time Preferences and Attitudes toward Risk," American Economic Review, American Economic Association, vol. 99(3), pages 937-955, June.
    14. Klaus Wälde & Agnes Moors, 2016. "Current Emotion Research in Economics," Working Papers 1612, Gutenberg School of Management and Economics, Johannes Gutenberg-Universität Mainz.
    15. Christian Seidl, 2013. "The St. Petersburg Paradox at 300," Journal of Risk and Uncertainty, Springer, vol. 46(3), pages 247-264, June.
    16. Gabriel Leite Mota, 2007. "Why Should Happiness Have a Role in Welfare Economics? Happiness versus Orthodoxy and Capabilities," FEP Working Papers 253, Universidade do Porto, Faculdade de Economia do Porto.
    17. Raman Kachurka & Michał Krawczyk & Joanna Rachubik, 2020. "What do lab experiments tell us about the real world? The case of lotteries with extreme payoffs," Working Papers 2020-03, Faculty of Economic Sciences, University of Warsaw.
    18. Ben McQuillin & Robert Sugden, 2012. "Reconciling normative and behavioural economics: the problems to be solved," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 38(4), pages 553-567, April.
    19. Sokratous, Konstantina & Fitch, Anderson K. & Kvam, Peter D., 2023. "How to ask twenty questions and win: Machine learning tools for assessing preferences from small samples of willingness-to-pay prices," Journal of choice modelling, Elsevier, vol. 48(C).
    20. Mora Rodriguez, Jhon James, 2013. "Introduccion a la teoría del consumidor [Introduction to Consumer Theory]," MPRA Paper 48129, University Library of Munich, Germany, revised 08 Jul 2013.

    More about this item

    Keywords

    utility maximization; experiment; Klein-Rubin utility function; perception utility; emotion utility;
    All these keywords.

    JEL classification:

    • A10 - General Economics and Teaching - - General Economics - - - General
    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:ifwedp:201232. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/iwkiede.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.