An Investigation of the Structural Change in Urban Iranian Consumers’ Preferences for Tea Using Nonparametric Revealed Preference Test

Salami, Habibollah; Pakravan, Mohammadreza; Kavoosi Kalashami, Mohammad

doi:10.22059/ijaedr.2012.30496

An Investigation of the Structural Change in Urban Iranian Consumers’ Preferences for Tea Using Nonparametric Revealed Preference Test

Authors

Habibollah Salami

Mohammadreza Pakravan

Mohammad Kavoosi Kalashami

10.22059/ijaedr.2012.30496

Abstract

Stability and structural change of Iranian consumers' preference for tea commodities during 1988-2005 is investigated throughout the coarse of this study. To this end, nonparametric Test of Revealed Preference has been utilized. Results of Weak Axiom of Revealed Preference (WARP) show that in 1995 a contradiction has been in observed consumers' preference for tea with the Null Hypothesis of Preference Stability being rejected. The calculated K-W statistic supports the notion that the revealed WARP violation is not a transitory shock, but caused by a permanent structural change in consumers’ preferences. . . . . . . . . . .

Keywords

Iran

Revealed preference

Tea

Transitory shock