TY - JOUR
T1 - Single-Crossing Differences in Convex Environments
AU - Kartik, Navin
AU - Lee, Sang Mok
AU - Rappoport, Daniel
N1 - Publisher Copyright:
© The Author(s) 2023.
PY - 2024/10/1
Y1 - 2024/10/1
N2 - An agent's preferences depend on an ordered parameter or type. We characterize the set of utility functions with single-crossing differences (SCD) in convex environments. These include preferences over lotteries, both in expected utility and rank-dependent utility frameworks, and preferences over bundles of goods and over consumption streams. Our notion of SCD does not presume an order on the choice space. This unordered SCD is necessary and sufficient for "interval choice"comparative statics. We present applications to cheap talk, observational learning, and collective choice, showing how convex environments arise in these problems and how SCD/interval choice are useful. Methodologically, our main characterization stems from a result on linear aggregations of single-crossing functions.
AB - An agent's preferences depend on an ordered parameter or type. We characterize the set of utility functions with single-crossing differences (SCD) in convex environments. These include preferences over lotteries, both in expected utility and rank-dependent utility frameworks, and preferences over bundles of goods and over consumption streams. Our notion of SCD does not presume an order on the choice space. This unordered SCD is necessary and sufficient for "interval choice"comparative statics. We present applications to cheap talk, observational learning, and collective choice, showing how convex environments arise in these problems and how SCD/interval choice are useful. Methodologically, our main characterization stems from a result on linear aggregations of single-crossing functions.
KW - Aggregating single crossing
KW - Choice among lotteries
KW - Interval equilibria
KW - Monotone comparative statics
UR - https://www.scopus.com/pages/publications/85203324905
U2 - 10.1093/restud/rdad103
DO - 10.1093/restud/rdad103
M3 - Article
AN - SCOPUS:85203324905
SN - 0034-6527
VL - 91
SP - 2981
EP - 3012
JO - Review of Economic Studies
JF - Review of Economic Studies
IS - 5
ER -