Paper #789

Title:

Biased quantitative measurement of interval ordered homothetic preferences

Authors:

Marc Le Menestrel and Bertrand Lemaire

Date:

July 2004

Abstract:

We represent interval ordered homothetic preferences with a quantitative homothetic utility function and a multiplicative bias. When preferences are weakly ordered (i.e. when indifference is transitive), such a bias equals 1. When indifference is intransitive, the biasing factor is a positive function smaller than 1 and measures a threshold of indifference. We show that the bias is constant if and only if preferences are semiordered, and we identify conditions ensuring a linear utility function. We illustrate our approach with indifference sets on a two dimensional commodity space.

Keywords:

Weak order, semiorder, interval order, intransitive indifference, independence, homothetic, representation, linear utility

JEL codes:

D000, D110, D210, O220

Area of Research:

Management and Organization Studies

Published in:

Journal of Mathematical Psychology, 50, 570-581, 2006
With the title:
Biased Extensive Measurement: The General Case

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