Consistent subsets: Computing the Houtman

Abstract

The Houtman–Maks index is a measure of the size of a violation of utility-maximizing (that is, rational) behavior. In this article, we introduce the command hmindex, which calculates the Houtman–Maks index for a dataset of prices and observed choices of a consumer. The command is illustrated with an empirical application.

Keywords

st0720 hmindex Houtman–Maks index revealed preference WGARP WARP

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References

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Consistent subsets: Computing the Houtman–Maks index in Stata

Abstract

Keywords

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