RESEARCH

Homotheticity is a property of preferences in which the proportional scaling of all consumption bundles preserves the same preference ranking. This property simplifies economic analysis as a single indifference curve can represent the entire preference profile of a consumer. This paper investigates the empirical implications of consumer behavior with nontransitive and homothetic preference relations. Using datasets consisting of finitely many observations of price vectors and consumption bundles, we offer a rationalization of  the pairwise homothetic axiom of revealed preference (PHARP) proposed by Varian (1982) without requiring  restrictions on the number of goods. Our work presents an exact analog of Varian (1982)'s theorem on nonparametric tests for homothetic utility maximization applied specifically to PHARP. Moreover, we propose a testable condition for PHARP based on the axiomatic approach of bilateral index number theory. We show that compliance with PHARP is equivalent to the conditions where the Laspeyres quantity and price indexes are greater than or equal to the corresponding Paasche indexes. Finally, we outline a method for recovering valid homothetic preferences from data that satisfy PHARP. We show that applying the method of  Knoblauch (1993) to such data when HARP is not satisfied can yield non-sharp lower and upper bounds.

This paper develops a nonparametric revealed-preference framework for testing and measuring returns to scale in production. I first extend Varian (1984) constant-returns-to-scale test by deriving a finite system of inequalities in normalized prices and input bundles that is necessary and sufficient for cost minimization under a homogeneous production function of any degree k > 0. The result ensures that any rationalizing technology can be taken continuous, concave, monotone, and homogeneous, and yields a continuous index measuring the minimal departure from constant returns needed to reconcile the data. To accommodate measurement error and frictions, I introduce an ε-cost–rationalization that allows observation-specific multiplicative efficiency coefficients. This leads to a multiplicative Cost Consistency Efficiency Index summarizing the dataset’s proximity to homogeneity. I further extend the framework to multi-firm datasets, providing a collective test for whether firms share a common homogeneous technology and showing that the efficiency index is monotone under data expansion. The approach is fully nonparametric, com- putationally tractable, and applicable to empirical analyses of scale properties and technological heterogeneity

We study nonparametric welfare identification when observed consumer choices may violate transitivity. Our focus is the income compensation function, which measures the minimum expenditure required to attain a given level of well-being and underlies cost-of-living and standard-of-living indexes. Rather than imposing the Generalized Axiom of Revealed Preference (GARP), we work under the Weak Generalized Axiom of Revealed Preference with efficiency slack (e-WGARP), a minimal consistency condition that rules out only direct pairwise contradictions while permitting nonconvex and nontransitive preferences. Using a preference function framework that accommodates such behavior, we introduce the notion of efficient rationalization under e-WGARP. Within this structure, we derive sharp nonparametric bounds on the efficient preferred set and on the income compensation function for any reference bundle. These results yield partial identification of cost-of-living and standard-of-living indexes without imposing transitivity or convexity. When e = (1, . . . , 1), the framework nests exact WGARP; for e < 1, it delivers strictly tighter welfare bounds than existing GARP-based methods.

This paper develops a revealed-preference framework for welfare analysis when preferences may be nonconvex but satisfy homotheticity and symmetry. Without convexity, standard nonparametric tools often produce weak or empty bounds. I show that symmetry—requiring utility to be invariant under permutations of goods—restores empirical structure by implying that each observed choice must remain optimal under all coordinate permutations, generating a symmetrized dataset with stronger implications than the original. I establish that a dataset is rationalizable by a continuous, strictly increasing, homothetic, and symmetric (but not necessarily convex) utility function if and only if its symmetrized expansion satisfies the Homothetic Axiom of Revealed Preference (HARP). Using this characterization, I derive sharp, nonconvexity robust bounds on indifference curves and the expenditure function, expressed as intersections of monotone-homothetic revealed-preference sets across permutations; these strictly refine the bounds available under the Genearalize Axiom of Revealed Preference alone. Symmetry thus serves as an identification device, tightening the set of admissible preferences and delivering the strongest possible nonparametric predictions consistent with homotheticity without relying on convexity. The framework applies to settings with interchangeable goods—such as time-dated consumption, divisible categories, and portfolio allocation and offers practical tools for welfare and counterfactual analysis.

The Generalized Axiom of Price Preference (GAPP) provides a powerful framework for analyzing consumer behavior, but its reliance on the often-violated assumption of transitivity limits its applicability.  This paper introduces the Weak Generalized Axiom of Price Preference (WGAPP), a novel approach that relaxes the transitivity requirement while retaining considerable analytical power. WGAPP utilizes augmented preference functions to model nontransitive preferences, providing a measure of preference strength between prices. We provide a revealed-preference characterization of WGAPP for finite datasets as well as a practical, empirically testable characterization based on Laspeyres and Paasche price indexes. This new framework offers a robust and flexible tool for analyzing consumer welfare and the impact of price changes in settings where nontransitive preferences are prevalent.

This study considers the interaction between a principal without persuasion ability and a mediator who has the ability to costly persuade a receiver. The principal could design a contract contingent on the receiver's action to provide incentive and coordinate the mediator. The principal cannot observe the mediator's disclosure policy and can only contract on receiver's actions.  We characterize the outcome under the first-best scenario  and  that under mediator's moral hazard. Our results show that, in general,  there  exists distortion when the mediator's utility is multiplicatively state-dependent. This results contrasts the no-distortion results under state-independent and additively state-dependent utility. We further consider a case where the principal could buy out the mediator persuasion technology and the case with continuum of states. 

This paper examines the correlation between proximity to local infrastructure and public trust in local governments. Using data from the sixth round of the Afrobarometer survey in Cameroon, we construct an infrastructure indicator index to measure respondents' proximity to local infrastructure. The index considers whether the respondent lives in a primary sampling unit (PSU) with access to electricity, water, cell phone service, a sewerage system, paved roads with a school, police station, post office, and health center within walking distance. The study shows a positive and statistically significant relationship between proximity to infrastructure and public trust in local government. Investigating heterogeneity of the effect of local infrastructures, we find that men and urban dwellers entirely drive it. We further explore whether a specific local infrastructure may influence the relationship and find that a police station, post office, and, to a lesser extent, school predominantly drive this relationship. The results suggest that Cameroonians' willingness to reward infrastructure in their neighborhoods by trusting their government officials who facilitate them indicates a desire for bottom-up political accountability in the absence of citizens' ability to hold top government officials accountable due to limited levels of democracy. Infrastructure provision has become an important measure of government performance, where communities with better access express greater trust in local government officials. This study adds to the literature on political trust and expands our understanding of how trust emerges in contexts where the polity has little space for democratic discourses.

To what extent do pre-colonial religious institutions and gender dynamics explain political behavior in Africa? We address this question by focusing on the role of missionary schools in shaping comparative voting behavior in Africa. Using Cagé and Rueda's (2016) data on missionary activity in Africa and controlling for several important covariates, including those that determine the historical locations of missions, we find that in regions near Protestant missions, proximity to a school is associated with a higher likelihood of voting in the last election. Examining heterogeneous gender effects, we find that proximity to Protestant missions with a school has a persistent effect on women but virtually small to no effect on men. More importantly, when we focus only on democratic countries, proximity to a school no longer matters. The result suggests that democracies compensate for the differences in political participation caused by missionary schools. Our analysis underscores the heterogeneous nature of precolonial religious institutions as a determinant of gender differences in voting behavior in Africa.

To what extent can Africa’s present-day ethnic-based discrimination be traced back to its colonial policies? 

This study explores this question by examining and contrasting the effects of France's direct rule and Britain’s indirect rule across the continent.