Template-type: ReDif-Paper 1.0 Author-Name: Demuynck, T. Author-workplace-name: Microeconomics & Public Economics Author-Name: Seel, C. Author-workplace-name: Microeconomics & Public Economics Title: Revealed preference with limited consideration Abstract: We derive revealed preference tests for models where individuals use consideration sets to simplify their consumption problem. Our basic test provides necessary and sufficient conditions for consistency of observed choices with the existence of consideration set restrictions. The same conditions can also be derived from a model in which the consideration set formation is endogenous and based on subjective, unconstrained beliefs about the prices. By imposing restrictions on these subjective beliefs, we obtain additional refined revealed preference tests. We illustrate and compare the performance of our tests by means of a dataset on household consumption choices. Series: GSBE Research Memoranda Creation-Date: 20140101 Number: 036 File-URL: https://cris.maastrichtuniversity.nl/ws/files/810127/guid-9c27b0ed-e27e-48fc-8dc9-3dc87dbe4809-ASSET1.0.pdf File-Format: application/pdf File-Size: 356482 Handle: Repec:unm:umagsb:2014036 DOI: 10.26481/umagsb.2014036