Suchergebnisse

The development of ordinalism was fostered by the idea of dispensing with external psychological arguments in utility theory and building the whole theory of the consumer upon indifference curves (and maps). Yet the pioneers of ordinalism, Fisher and Pareto, did not make clear whether indifference curves should be considered as an observational, experimental, or purely theoretical construction (possibly based upon introspection). Indeed, the exact status of indifference curves for the theory of choice was not seriously debated before the 1930s and 1940s, in the United States. An experiment by the psychologist Louis Leon Thurstone was then the starting point for some clarifications about the role of experimental economics for the new theory of the consumer. The aim of this article is to throw light on the ins and outs of this issue of the ordinalist revolution. Thurstone's experiment was the occasion for a debate on the status of indifference curves and more broadly on the role of experiments within the theory of choice. It would lead economists (such as Georgescu-Roegen, Wallis, Friedman, and Samuelson) to clarify the methodological foundations of the theory of choice and to express strong divergences about the usefulness of the theory.

Professors in intermediate and advanced microeconomic theory courses often propose a proof that indifference curves cannot intersect that relies on the transitivity and monotonicity of preferences. In the interest of stimulating thought on the topic, we derive an elementary proof that indifference curves cannot intersect which relies on fewer assumptions than the traditional proof. We conclude that transitivity is essential in constructing a theory of rational choice; but transitivity is not essential in showing that indifference curves cannot intersect.