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on Discrete Choice Models |
| By: | Paola, Manzini; Marco, Mariotti |
| Abstract: | We model a boundedly rational agent who suffers from limited attention. The agent considers each feasible alternative with a given (unobservable) probability, the attention parameter, and then chooses the alternative that maximises a preference relation within the set of considered alternatives. We show that this random choice rule is the only one for which the impact of removing an alternative on the choice probability of any other alternative is asymmetric and menu independent. Both the preference relation and the attention parameters are identi fied uniquely by stochastic choice data. |
| Keywords: | Discrete choice, Random utility, Logit model, Luce model, Consideration sets, bounded rationality, revealed preferences, |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:edn:sirdps:463&r=dcm |
| By: | Vij, Akshay |
| Keywords: | Architecture |
| Date: | 2013–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:uctcwp:qt7nq9p0cv&r=dcm |
| By: | Roberto Josep Martí (Departament of Economics, Universitat Jaume I, Castellón, Spain); Maite Alguacil (Departament of Economics, Universitat Jaume I, Castellón, Spain); Vicente Orts (Departament of Economics, Universitat Jaume I, Castellón, Spain) |
| Abstract: | In this paper we examine how different host country characteristics affect the location decision of Spanish multinational firms in developing and transition countries, particular attention being paid to the sectoral composition of foreign direct investments (FDI). The estimation of a set of logit models allows us to consider different substitutability patterns among alternatives. The study focuses on a broad firm-level sample of 4,177 Spanish affiliates established in 52 countries over the period 1990 to 2010. The results suggest that Spanish FDI in developing and transition economies are driven by both market-seeking and efficiency-seeking factors. FDI is found to be positively related to the size of the market and negatively related to labor costs. The estimates also reveal that Spanish investment in developing and transition countries exhibit a pronounced agglomeration effect, although the intensity of these externalities depends on both the sort of activity and the nationality of competitors. Furthermore, our results show differences between manufactures and services in other local factors, such as human capital, macroeconomic instability, and financial risk, thereby confirming the idea that investors in each sector have different motivations for locating foreign affiliates in developing countries. The quality of infrastructures and institutions also appear to influence the location of FDI in these economies. |
| Keywords: | Location choice; Nested and Mixed Logit models; Developing and transition countries; Multinational firms |
| JEL: | F21 F23 R39 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:jau:wpaper:2013/19&r=dcm |
| By: | Sagebiel, Julian; Müller, Jakob R.; Rommel, Jens |
| Abstract: | With liberalization in 1998, numerous firms have entered the German retail electricity market, including newly formed cooperatives. Based on Transaction Cost Economics, we develop a theoretical framework seeking to explain preferences for electricity supplied by cooperatives from a consumer perspective. Drawing on a convenience sample of 287 German electricity consumers and Choice Experiment data from an online survey, we estimate Willingness-to-Pay values for organizational attributes of electricity suppliers, while accounting for observed and unobserved heterogeneity. Consumers in the sample exhibit a large Willingness-to-Pay for renewable energy. Our results also indicate a substantial Willingness-to-Pay for transparent pricing, participation in decision making, and local suppliers. Democratic decision making – a distinct feature of cooperatives – exhibits positive Willingness-to-Pay values for approximately one fifth of the sample. Taken together, our findings suggest a slightly higher Willingness-to-Pay for electricity produced by cooperatives. Limitations of applied sampling and other important aspects of energy transition are also discussed. |
| Keywords: | Choice Experiments; Cooperatives; Energy Transition |
| JEL: | C25 D12 Q41 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:52385&r=dcm |
| By: | LUYTEN, Jeroen; KESSELS, Roselinde; GOOS, Peter; BEUTELS, Philippe |
| Abstract: | Through a discrete choice experiment we elicited the Belgian adult population’s (18-75y; N = 750) preferences for prioritizing health care. We used a Bayesian D-efficient design with partial profiles, which enables considering a large number of attributes and interaction effects. We included the attributes (i) type of intervention (cure versus prevention), (ii) effectiveness, (iii) risk of adverse effects, (iv) severity of illness, (v) link between the illness and patient’s health-related lifestyle, (vi) timespan between intervention and effect and (vii) patient’s age group. All attributes were significant, with patient’s lifestyle and age being the most influential. Interaction effects were found, showing that prevention was preferred to cure for disease in young adults, as well as for severe and lethal disease in people of any age. Substantial preference heterogeneity exists between respondents from different age groups, with different lifestyles and different health states. |
| Keywords: | Efficiency, Equity, Distribution, QALY, Treatment, Prevention |
| JEL: | C25 D61 D63 H42 H51 I10 |
| Date: | 2013–12 |
| URL: | http://d.repec.org/n?u=RePEc:ant:wpaper:2013032&r=dcm |
| By: | Shchetinin, Oleg (Department of Economics, School of Business, Economics and Law, Göteborg University); Wollbrant, Conny (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | Microfinance institutions are key financial intermediaries between donors and borrowers in developing countries. Loan officers are crucial for establishing and maintaining the relationship between borrowers and microfinance institutions. This paper studies the impact of loan officers on the loan portfolio. We use a survey and choice experiment of 800 loan officers to estimate loan officers’ preferences over loan allocation. We investigate how these preferences are affected by the organizational structure of the microfinance institution, for example, incentive provision. We pay special attention to monitoring of borrowers and loan officer discretion. The most important determinants of loan allocation are related to the financial viability of microfinance institutions rather than the pro-social mission of microfinance. We derive recommendations for the governance of microfinance institutions. |
| Keywords: | Financial intermediation; Microfinance; Loan officers; Loan allocation; Choice experiment |
| JEL: | G21 L31 O16 |
| Date: | 2013–12–17 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0581&r=dcm |
| By: | Straume, Hans-Martin (Department of Economics, University of Bergen) |
| Abstract: | The purpose of this paper is to examine the choice of currency for Norwegian salmon exporters. The choice of invoicing currency will affect prices in different markets as well as risk, factors that are becoming increasingly important as the supply chain for salmon is becoming more sophisticated, and more transactions mechanisms introduced. The results indicate that destination specific market characteristics have impacts as to the choice of invoicing strategy. Norwegian salmon exporters primarily invoice in the export market currency (47% of the exported quantity), but also use a vehicle currency and producer pricing (19%) in a significant number of transactions. Euro is the preferred vehicle currency (18%), closely followed by USD (16%). USD is the dominating invoicing currency for exports beyond Europe. |
| Keywords: | Invoicing currency; salmon; exchange rates; multinomial logit; |
| JEL: | F14 Q22 |
| Date: | 2013–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:bergec:2013_011&r=dcm |
| By: | Thum, Anna-Elisabeth |
| Abstract: | Personality, ability, trust, motivation and beliefs determine outcomes in life and in particular those of economic nature such as finding a job or earnings. A problem with this type of determinants is that they are not immanently objectively quantifiable and that there is no intrinsic scale - such as in the case of age, years of education or wages. Often we think of these concepts as complex and several items are needed to capture them. In the measurement sense, we dispose of a more or less noisy set of measures, which indirectly express and measure a concept of interest. This way of conceptualizing is used in latent variables modelling. I examine in this article in how far economic and econometric literature can contribute to specifying a framework of how to use latent variables in economic models. As a semiparametric identification strategy for models with endogeneous latent factors I propose to use existing work on identification in the presence of endogeneous variables and examine which additional assumptions are necessary to apply this strategy for models with latent variables. I discuss several estimation strategies and implement a Bayesian Markov Chain Monte Carlo (MCMC) algorithm. |
| Keywords: | latent variable modelling, identification with endogenous regressors, monte carlo markov chain |
| JEL: | C11 C14 C38 J24 |
| Date: | 2013–12–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:52293&r=dcm |