The Empirical Content of Revealed Preference in High Dimensions (opens in new tab)

We examine how the empirical content of revealed preference theory depends on the dimensionality of the choice environment. While higher-dimensional choice problems may appear more demanding, we show that revealed preference restrictions become less informative. Using Selten's Area measure, we establish that for any fixed number of observations, the empirical content of GARP converges to zero exponentially fast in the number of goods. We provide...