On the tautology of the matching law in consumer behavior analysis

Abstract

Matching analysis has often attracted the criticism that it is formally tautological and hence empirically unfalsifiable, a problem that particularly affects translational attempts to extend behavior analysis into new areas. An example is consumer behavior analysis where application of matching in natural settings requires the inference of ratio-based relationships between amount purchased and amount spent. This gives rise to the argument that matching is an artifact of the way in which the alleged independent and dependent variables are defined and measured. We argue that the amount matching law would be tautological only in extreme circumstances (those in which prices or quantities move strictly in proportion); this is because of the presence of an error term in the matching function which arises from aggregation, particularly aggregation over brands. Cost matching is a viable complement of amount matching which avoids this tautology but a complete explanation of consumer choice requires a viable measure of amount matching also. This necessitates a more general solution to the problem of tautology in matching. In general, the fact that there remain doubts about the functional form of the matching equation itself implies the absence of a tautology. In proposing a general solution to the problem of assumed tautology in matching, the paper notes the experiences of matching researchers in another translation field, sports behavior.