I've been having difficulty finding some research on indifference curves/utility functions and methods in constructing them in an applied manner.

Does anyone have any papers or pdf books to recommend?

  • $\begingroup$ what do you mean by "applied manner"? $\endgroup$ – Yorgos Jan 3 '17 at 21:30
  • $\begingroup$ @Yorgos are able to infer them in real life. How do economists go about making indifference curves that represent an individuals preference in an accurate or approximate manner. $\endgroup$ – EconJohn Jan 3 '17 at 21:35
  • $\begingroup$ I believe that this is very general question. You must be more specific in the sense, you are interested in consumer utility function, producer utility function. Also you want utility functions to capture risk aversion or behavioral biases? $\endgroup$ – Yorgos Jan 3 '17 at 21:43
  • $\begingroup$ My point is that it would be easier to provide a reference if you could be more specific on the type of the individual for whom you want to construct a utility function, or the area of research you are interested in $\endgroup$ – Yorgos Jan 3 '17 at 21:52
  • $\begingroup$ @Yorgos producers don't have utility functions.... also the consumer theory tag tells who I'm talking about. $\endgroup$ – EconJohn Jan 3 '17 at 21:55

The most famous one is probably Afriat's 1967 paper titled "The construction of a utility function from demand data".

You can also find the basic idea in Hal Varian's Intermediate Microeconomics: Revealed Preferences Chapter or you can read the generalized version of the theorem in the paper.

  • $\begingroup$ I believe Kreps also covers this result in his text on Microeconomic Foundations. $\endgroup$ – Theoretical Economist Jan 3 '17 at 7:49
  • $\begingroup$ @TheoreticalEconomist I haven't read it but that seems probable. It is an important result showing the possible uses (and limitations) of utility functions and I have high regard for Kreps :) $\endgroup$ – Giskard Jan 3 '17 at 7:52
  • 1
    $\begingroup$ Kreps is great. Check out the book -- it's not too expensive for a textbook, and his treatment of the material he does cover is second to none. $\endgroup$ – Theoretical Economist Jan 3 '17 at 7:53

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