  This paper provides a model to analyze and identify a decision maker's (DM's)
hypothetical reasoning. Using this model, I show that a DM's propensity to
engage in hypothetical thinking is captured exactly by her ability to recognize
implications (i.e., to identify that one hypothesis implies another) and that
this later relation is encoded by a DM's observable behavior. Thus, this
characterization both provides a concrete definition of (flawed) hypothetical
reasoning and, importantly, yields a methodology to identify these judgments
from standard economic data.
