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on Discrete Choice Models |
| By: | Mogens Fosgerau (Technical University of Denmark [Lyngby]); André De Palma (CES, ENS Cachan, CNRS, Universite Paris-Saclay, 94235 Cachan, France) |
| Abstract: | We formulate a family of direct utility functions for the consumption of a differentiated good. This family is based on a generalization of the Shan-non entropy. It includes dual representations of all additive random utility discrete choice models, as well as models in which goods are complements. Demand models for market shares can be estimated by plain regression, enabling the use of instrumental variables. Models for microdata can be estimated by maximum likelihood. |
| Keywords: | market shares,product differentiation,discrete choice,duality,generalized entropy , C25, L1 |
| Date: | 2016–03–25 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01291347&r=dcm |
| By: | Ahlheim, Michael; Neidhardt, Jan |
| Abstract: | This paper addresses a methodological problem of choice experiments, namely the problem that respondents sometimes avoid the intellectual effort of thoroughly considering the trade-offs between different alternatives that are the essence of every choice experiment, and tick instead the next best alternative without the necessary deliberation. This kind of behaviour which is called "nontrading" in the respective literature calls into question the validity of choice experiments. In this paper, which is based on an online choice experiment concerned with consumer's tastes for table grapes with 1,000 participants, we suggest possibilities to identify potential non-traders not only by their answering behaviour but also by some general characteristics we found to be typical of this kind of respondent. |
| Keywords: | Non-Trading Behaviour,Discrete Choice Experiment,Table Grapes |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:hohdps:012016&r=dcm |
| By: | West , Jens (KTH/Sweco); Börjesson , Maria (KTH); Engelson , Leonid (KTH) |
| Abstract: | This paper performs an ex-post evaluation of the transport model forecast of the effects of the Gothenburg congestion charges, implemented in 2013. We find that the predicted traffic reductions across the cordon and travel time gains were close to those observed in the peak. However, the reduction in traffic across the cordon was under-predicted in off-peak. The design of the charging system implies that the path disutility cannot be computed as a sum of link attributes. The route choice model is therefore implemented as a hierarchical algorithm, including a continuous value of travel time (VTT) distribution. The VTT distribution was estimated from stated choice (SC) data, but had to be adjusted to be consistent with observed outcome. One reason for the discrepancy may be that VTT inferred from SC data does not reveal travellers’ long-term preferences. Another reason may be that apart from distance, travel time and charge there are other factors that determine drivers’ route choice. |
| Keywords: | Congestion charges; Transport model; Validation; Value of time; Volume delay function; Decision support |
| JEL: | R41 R42 R48 |
| Date: | 2016–03–29 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ctswps:2016_009&r=dcm |
| By: | Jose Apesteguia; Miguel Ángel Ballester |
| Abstract: | We propose a novel model of stochastic choice: the single-crossing random utility model (SCRUM). This is a random utility model in which the collection of utility functions satisfies the single-crossing property. We offer a characterization of SCRUMs based on three easy-to-check properties: Positivity, Monotonicity and Centrality. The identified collection of utility functions and associated probabilities is basically unique. We establish a stochastic monotone comparative result for the case of SCRUMs and study several generalizations of SCRUMs. |
| Keywords: | stochastic choice; single-crossing property; random utility models; monotone comparative statics |
| JEL: | D00 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:891&r=dcm |
| By: | Jose Apesteguia; Miguel A. Ballester |
| Abstract: | We propose a novel model of stochastic choice: the single-crossing random utility model (SCRUM). This is a random utility model in which the collection of utility functions satis es the single-crossing property. We o er a characterization of SCRUMs based on three easy-to-check properties: Positivity, Monotonicity and Centrality. The identi ed collection of utility functions and associated probabilities is basically unique. We establish a stochastic monotone comparative result for the case of SCRUMs and study several generalizations of SCRUMs. |
| Keywords: | Stochastic Choice; Single-Crossing Property; Random Utility Models; Monotone Comparative Statics. |
| JEL: | D00 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1515&r=dcm |
| By: | Cherchye, Laurens (KU Leuven); De Rock, Bram (ECARES, Free University of Brussels); Telalagic Walther, Selma (University of Oxford); Vermeulen, Frederic (KU Leuven) |
| Abstract: | Do individuals divorce for economic reasons? Can we measure the attractiveness of new matches in the marriage market? We answer these questions using a structural model of the household and a rich panel dataset from Malawi. We propose a model of the household with consumption, production and revealed preference conditions for stability on the marriage market. We define marital instability in terms of the consumption gains to remarrying another individual in the same marriage market, and to being single. We find that a 1 percentage point increase in the wife's estimated consumption gains from remarriage is significantly associated with a 0:6 percentage point increase in divorce probability in the next three years. In a multinomial model, higher values of consumption gains from remarriage raise the odds of divorce and remarriage but not of divorce and singleness. These findings provide out-of-sample validation of the structural model and shed new light on the economic determinants of divorce. |
| Keywords: | marriage market, divorce, Malawi, agricultural production, revealed preference |
| JEL: | D11 D12 D13 J12 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9843&r=dcm |
| By: | Arkady Konovalov (Department of Economics, Ohio State University); Ian Krajbich (Department of Economics, Ohio State University) |
| Abstract: | Revealed preference is the dominant approach for inferring preferences, but it relies on discrete, stochastic choices. The choice process also produces response times which are continuous and can often be observed in the absence of choice outcomes. Here, using three common choice tasks, we demonstrate that response times reflect strength-of-preference and can thus be used to recover individual utility functions and predict choices out of sample. Furthermore, we are able to use long response times to predict which choices are likely to later be reversed. These results provide a proof of concept for a novel "method of revealed indifference". |
| Keywords: | preferences, response times, sequential sampling models, drift diffusion model, experimental methodology, social preference, loss aversion, temporal discounting |
| JEL: | C91 D01 D03 D87 D81 D90 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:osu:osuewp:16-01&r=dcm |
| By: | Sophie Dantan (Université Paris Saclay, ENS Cachan - École normale supérieure - Cachan); Nathalie Picard (Université de Cergy Pontoise) |
| Abstract: | This paper investigates the determinants of residential segregation in Paris region by disentangling households' preferences for local amenities, for dwelling type and for homeownership, in a nested logit model. This model is extended to account for unobservable borrowing constraints which might prevent some households from purchasing a dwelling. A counterfactual distribution of socio-demographic characteristics across the Paris region is then built by relaxing those constraints. The comparison of the actual and counterfactual distributions suggests that if their credit constraints were alleviated, households would tend to locate further from Paris. In particular if constraints were relaxed only on the poorest households, they would not be likely to mix with the richest households. |
| Keywords: | ,Homeownership,Tenure choice,Borrowing constraints,Residential segregation,Suburbanization,Urban sprawl,Location choice model,Endogenous choice sets |
| Date: | 2016–03–28 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01294215&r=dcm |
| By: | José Ernesto Amorós; María Soledad Etchebarne; Isabel Torres Zapata; Christian Felzensztein (School of Business and Economics, Universidad del Desarrollo) |
| Abstract: | The internationalization of new small and medium-sized enterprises is a challenge for many developing countries, especially those with open economies and small internal markets like Chile. This study, in an exploratory way, analyzes some of the factors that determine how new ventures are oriented to international markets from their early-stages. This paper develops a model that integrates variables related to firm characteristics like industrial sector, competitiveness, and size of the firm with a degree of internationalization. The empirical analysis uses data from the Global Entrepreneurship Monitor´s (GEM) adult population survey carried out in Chile during the period 2007-2013 (n=4,208). An ordinal logit regression model was used to test the hypotheses. Descriptive results show that 12.8% of Chilean entrepreneurs in the sample have a relatively high tendency towards internationalization and that the factors related to competitiveness are significant in respect to this tendency. The size of the firm and the propensity to create employment are also significant. Practical implications are discussed |
| Keywords: | Early internationalization; industrial sector; size; competitiveness; Chile; Global Entrepreneurship Monitor |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:dsr:wpaper:29&r=dcm |
| By: | Cardoso-Vargas, Carlos-Enrique |
| Abstract: | This document examines whether the agglomeration of foreign processing firms (PCS) assembling imported inputs to make export products favors the incorporation to the export activity or market expansion of domestic companies. Similarly this situation is evaluated by considering ordinary foreign firms (ORD) or not manufactured processed products and non-local hybrid companies (HBR) that act in both regimes of commerce. The theoretical framework guiding the empirical evaluation is based on a simple model inspired by Melitz (2003), which is evaluated by means of a conditional logit model with panel data. The findings show evidence that the concentration of these types of foreign companies increases the probability that domestic companies show a presence in certain markets. Notwithstanding, these export spillovers widely heterogeneous in virtue of the fact that their existence and sphere of influence are associated with their specificity in terms of country or product, as well as with the regime of commerce and the technological capacity used by domestic companies vis-à-vis neighboring foreign companies. |
| Keywords: | international trade, agglomeration externalities, heterogeneity firms |
| JEL: | F13 F14 F21 |
| Date: | 2016–02–27 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:70212&r=dcm |