Theoretical Economics Letters, 2018, 8, 2631-2639
http://www.scirp.org/journal/tel
ISSN Online: 2162-2086
ISSN Print: 2162-2078
10.4236/tel.2018.811167 Aug. 29, 2018 2631 Theoretical Economics Letters
A Representation of the Maximal Set in Choice
Problems Where Information Is Incomplete
Andrikopoulos Athanasios
Department of Computer Engineering and Informatics, University of Patras, Patras, Greece
Banerjee and Pattanaik [1] proved that the maximal set generated by a qua-
si-
ordering is equal to the union of the sets of best elements of its ordering
extensions. Suzumura and Xu [2] extended Banerjee and Pattanaik’
relaxing the axiom of transitivity to the axiom that Suzumura calls consisten-
cy. Arló Costa in [3] pointed out that in general,
an optimizing model cannot
require the transitivity of the binary relation used in an optimizing model. In
this paper, by using two important ideas of John Duggan [4],
I extend the
above mentioned results to arbitrary binary relations whose extensions are
complete and not necessarily transitive.
Keywords
Binary Relation, Best Element, Maximalel Ement, Optimal Set, Extension of a
1. Introduction
The economic approach to rational behaviour assumes that each individual
makes choices by selecting, from each feasible set of alternatives, those which
maximize his own preference relation. The classical framework of optimization
used in standard choice theory recommends choosing, among the feasible
options, a best alternative. According to this modeling of a choice process, the
optimal choice set consists of the best alternatives according to a binary relation
R
. So, if
A
is the feasible set of alternatives and
R
is a binary relation over
A
, a
formalization of this idea requires the following definition of the optimal choice
set
:
( ) { }
, | for all ,G A R x A y A xRy=∈∈
.
Many economists have pointed out that this stringent form of maximization
might not be the kind of optimization that one can apply in problems where
Athanasios, A.
8)
A Representation of the Maximal
Set in
Choice Problems Where Information
.
Theoretical Economics Le
,
, 2631-2639.
https://doi.org/10.4236/tel.2018.811167
June 21, 2018
August 26, 2018
August 29, 2018
8 by author and
Research Publishing Inc.
This work is licensed under the Creative
International
4.0).
http://creativecommons.org/licenses/by/4.0/