Econometrica

Journal Of The Econometric Society

An International Society for the Advancement of Economic
Theory in its Relation to Statistics and Mathematics

Edited by: Guido W. Imbens • Print ISSN: 0012-9682 • Online ISSN: 1468-0262

Econometrica: Jan, 2004, Volume 72, Issue 1

Information‐Based Relative Consumption Effects

https://doi.org/10.1111/j.1468-0262.2004.00479.x
p. 93-118

Larry Samuelson

Preferences exhibit relative consumption effects if a person's satisfaction with their own consumption appears to depend upon how much others are consuming. This paper examines a model of an evolutionary environment in which Nature optimally builds relative consumption effects into preferences in order to compensate for incomplete environmental information.


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