Revealed Preference
Revealed preference theory addresses the problem of how to observe ordinal preference relations in the real world. The challenge of revealed preference theory lies in part in determining what goods bundles were foregone, on the basis of the being less liked, when individuals are observed choosing particular bundles of goods.
Read more about this topic: Ordinal Utility
Famous quotes containing the words revealed and/or preference:
“... we engage in politics because we don’t know anything. This is clearly revealed in the way we go about it. Our parties exist from a fear of theory. The voter fears that one idea can always be contradicted by another. Therefore the parties reciprocally defend themselves against the few old ideas they have inherited. They don’t live from what they promise, but from frustrating the promises of others. This is their silent community of interests.”
—Robert Musil (1880–1942)
“He that has his chains knocked off, and the prison doors set open to him, is perfectly at liberty, because he may either go or stay, as he best likes; though his preference be determined to stay, by the darkness of the night, or illness of the weather, or want of other lodging. He ceases not to be free, though the desire of some convenience to be had there absolutely determines his preference, and makes him stay in his prison.”
—John Locke (1632–1704)