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3. Can we tell what individual preferences are (e.g. for choice of housing location) simply by...

3. Can we tell what individual preferences are (e.g. for choice of housing location) simply by looking at aggregate outcomes? Why, or why not?

Behavioural economics

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Answer #1

Aggregate preferences refers to a cumalation formed as a whole of several individual preferences divided by the total number of individuals taken into consideration. Whereas individual demand differes from individual to individual. Even though the aggregate outcome can be stating the preferences most individuals prefer. But it also includes individuals who's preferences aren't the same as the aggregate outcome. Though for the aggregate preferences one needs to study individual preferences. But it isn't the same for Individual demand. The study of individual demand does not require the study of aggragate preferences. As one may have a preference which isn't similar to the aggregate preference. Therefore there shouldn't be any doubt in accepting that simple by looking at the aggregate outcome we cannot tell what the individuals preferences are.

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