Investigation of Consumer Rational Behavior of Vegetable Oil in Iran: Case Study of Refah Chain Stores

Document Type : Research Article

Authors

H. Tavana

M. Homayounifar

College of Agriculture, University of Zabol

https://doi.org/10.22067/jead2.v1387i2.1149

Abstract

Abstract
Consumer rational behavior is the first and basic presumption for representation and development of economic theories and relations in field of consumer behavior. For the most part investigations related to demand function, the estimation results is correct while demand function and implied utility be a good estimations of real utility and demand functions. This is not a testable hypothesis. Then, should be prove accuracy of rational behavior hypothesis. There exists only one method to investigate accuracy of rational behavior hypothesis and this is revealed preference. Used data in this study is monthly price and consumption quantity of vegetable oil that is mustered from Refah Chain Stores during 3 years (2004-2006). Test results indicated existence of 13 violations that did not rectify using generalized Afriat index and using graphical methodology of de Peretti, whole of period divided to two sub period, April 2004 to December 2005, and, January 2005 to February 2006, without any violations. Rupture in utility function is appeared as consumption reduction in more of studied rigid vegetable oils and approximate stability in liquid oils consumption. Thus, it could be prospected consumption reduction of vegetable oil in Iranian households by continuous medical and publicity policies about consumption detriments of vegetable oil.

Keywords

Generalized Axiom of Revealed Preference

Neoclassical Utility Function

Afriat Theorem

Generalized Afriat Index

Vegetable Oil

Iran

20.1001.1.20084722.1387.22.2.5.6

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