
Kreps–Porteus preferences constitute a widely used alternative to time separability. We showin this paper that with these preferences utility maximization does not impose any observable restrictions on a household’s savings decisions or on choices in good markets over time. The additional assumption of a weakly separable aggregator is needed to ensure that the assumption of utility maximization restricts intertemporal choices. Under this assumption, choices in spot marketsare characterized by a strong axiom of revealed preferences (SSARP).Under uncertainty Kreps–Porteus preferences impose observable restrictions on portfolio choice if one observes the last period of an individual’s planning horizon. Otherwise there are no restrictions.
Non-parametric restrictions, 2604 Applied Mathematics, Intertemporal choice, 10003 Department of Finance, 2002 Economics and Econometrics, Social choice, 330 Economics
Non-parametric restrictions, 2604 Applied Mathematics, Intertemporal choice, 10003 Department of Finance, 2002 Economics and Econometrics, Social choice, 330 Economics
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