New methods of modeling and estimating preferences
Studies in Economics and Finance
ISSN: 1086-7376
Article publication date: 15 May 2019
Issue publication date: 21 June 2019
Abstract
Purpose
This paper aims to quantify preferences without having to have any utility data.
Design/methodology/approach
We use duality theory, Taylor’s theorem and nonlinear regressions.
Findings
We presented pioneering quantitative methods in economics and business. These methods can be applied to numerous topics in empirical and theoretical economics and business. Moreover, this paper highlighted the interdisciplinary nature of economics. In doing so, it emphasized the interface between economics, marketing, management, statistics and mathematics. Furthermore, it circumvented a major obstacle in the literature: the curse of dimensionality.
Originality/value
The authors introduce a novel and convenient approach to utility modeling. In doing so, they present a general utility function in a simple form. Furthermore, they develop a method to measure preferences without any utility data. They also devise a method to measure the marginal utility. Then, they develop new methods of modeling and measuring the consumer utility. In so doing, they overcome a major obstacle: the curse of the dimensionality. In addition, they introduce new methods of modeling and measuring the consumer demand for the firm’s good.
Keywords
Citation
Alghalith, M. (2019), "New methods of modeling and estimating preferences", Studies in Economics and Finance, Vol. 36 No. 1, pp. 83-88. https://doi.org/10.1108/SEF-12-2017-0354
Publisher
:Emerald Publishing Limited
Copyright © 2019, Emerald Publishing Limited