Understanding Preference Imprecision

Oben K. Bayrak and John D Hey

Abstract

The term ‘preference imprecision’ seems to have different meanings to different people. In the literature, one can find references to a number of expressions. For example: vagueness, incompleteness, randomness, unsureness, indecisiveness and thick indifference curves. Some of these are theoretical constructs, some are empirical. The purpose of this paper is to survey the various different approaches and to try to link them together: to see if they are all addressed to the same issue, and to come to some conclusions. In the course of this survey, we report on evidence concerning the existence of preference imprecision, and its impact on theoretical and empirical work.

JEL classification: D0, D80, D81

Keywords: preference imprecision, stochastic models, anomalies, incompleteness, equivalence interval, vagueness, strength of preference.

The Paper (PDF , 899kb) is here.

Appendix B (PDF , 633kb) is here.