Early Experiments in Consumer Demand Theory: 1930-1970

Abstract

This paper reconstructs the history of experimental research on riskless choices during the period 1930-70. The experiments considered here regarded the derivation of indifference curves and the evaluation of the transitivity assumption, that is, matters that in neoclassical economics traditionally pertain to consumer demand theory. The paper examines the design of the experiments at issue, investigates their backgrounds and their reception among the economics profession, and discusses their impact on the development of neoclassical consumption theory

Estimating Rationality in Economics: A History of Statistical Methods in Experimental Economics

“…(Roth, 1995;Moscati, 2007;Heukelom, 2014), even if Thurstone was not an economist. We follow this convention and start our narrative in 1931, even if most of the early economic experiments were actually published in the late 1940s and in the 1950s.…”

“…Yet histories of EE do not give much importance to statistics (Roth, 1995;Lee and Mirowski, 2007;Moscati, 2007;Serra, 2012;Heukelom, 2014;Svorenčík, 2015;Cot and Ferey, 2016). It seems that in the early years of EE, lab experiments raised different methodological issues.…”

Stated preference methods and their applicability to environmental use and non-use valuations

“…According to Moscati (2007), Harold Hotelling and Ragnar Frisch panned Thurstone's presentation from the floor. They objected that Thurstone's indifference curves as constructed were insufficient to forecast market demand response to price changes, failing to recognize that extending Thurstone's elicitations to include residual expenditure would have solved the problem.…”

Constructing Markets: Environmental Economics and the Contingent Valuation Controversy

“…Experimental economics often begins by inducing preferences with the incentives of material rewards and then proceeds to test how different institutions perform at processing those incentives and producing desirable (rational and efficient) outcomes, which V. Smith (1982) called the "Hayekian hypothesis" (Guala 2007, Muniesa andCallon 2007). Thus,7 On the history of experimental economics, see Guala (2005Guala ( , 2007, Moscati (2007), and Svorenčík (2015). the institution (or machine) does the work.…”

“…Thurstone to estimate utility functions over consumer goods (Moscati 2007). Friedman argued on methodological grounds that individuals' own understanding of their actions need not match a scientific description of them.…”