We construct a complete space of smooth strictly convex preference relations defined over physical commodities and monetary transfers. This construction extends the classic one by assuming that preferences are monotone in transfers, but not necessarily in all commodities. This provides a natural framework to perform genericity analyses in situations involving inventory costs or decisions under risk.
Smooth Preferences; Nonmonotonicity;
- C60: General
- D11: Consumer Economics: Theory
TSE Working Paper, n. 17-799, April 2017, revised October 2017