Abstract
The revealed preference approach in economics is central to the empirical analysis of consumer behavior. In this article, we introduce the Stata commands checkax, aei, and powerps as a bundle within the package rpaxioms. The first command allows a user to test whether consumer expenditure data satisfy several revealed preference axioms; the second command calculates measures of goodness of fit when the data violate these axioms; and the third command calculates power against uniformly random behavior as well as predictive success for each axiom. We illustrate the commands using individual-level experimental data and household-level aggregate consumption data.
Citation
Demetry, M., Hjertstrand, P. and Polisson, M., 2022. Testing axioms of revealed preference in Stata. The Stata Journal, 22(2), pp.319-343.
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Citation for Stata package
Marcos Demetry & Per Hjertstrand & Matthew Polisson, 2020. "RPAXIOMS: Stata module to test and evaluate axioms of revealed preferences," Statistical Software Components S458800, Boston College Department of Economics, revised 10 Jun 2022. <https://ideas.repec.org/c/boc/bocode/s458800.html>