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on Discrete Choice Models |
| By: | Jose Apesteguia; Miguel Ángel Ballester; Angelo Gutierrez |
| Abstract: | We develop a simple, tractable and sound stochastic framework for the joint treatment of risk and time preferences, in order to facilitate the estimation of risk and time attitudes. In so doing we: (i) study deterministic models of risk and time preferences paying special attention to their comparative statics, (ii) embed the deterministic models and their comparative statics within the random utility framework, and (iii) show how to estimate them, illustrating this exercise on several experimental datasets. |
| Keywords: | Risk preferences, time preferences, comparative statics, stochastic choice, random utility models, discrete choice. |
| JEL: | C01 D01 |
| Date: | 2019–09 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1671&r=all |
| By: | Jose Apesteguia; Miguel Ángel Ballester; Angelo Gutierrez |
| Abstract: | We develop a simple, tractable and sound stochastic framework for the joint treatment of risk and time preferences, in order to facilitate the estimation of risk and time attitudes. In so doing we: (i) study deterministic models of risk and time preferences paying special attention to their comparative statics, (ii) embed the deterministic models and their comparative statics within the random utility framework, and (iii) show how to estimate them, illustrating this exercise on several experimental datasets. |
| Keywords: | risk preferences, time preferences, comparative statics, stochastic choice; random utility models, discrete choice |
| JEL: | C01 D01 |
| Date: | 2019–09 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:1117&r=all |
| By: | Laurence Ales (Carnegie Mellon University); Christopher Sleet (Carnegie Mellon University) |
| Abstract: | In this paper we derive optimal tax equations for discrete choice economies with smooth underlying shock distributions and potentially unstructured choice sets. This approach expands the set of applications for which optimal tax equations are available, permits rich substitution patterns between choices, unifies existing results on income and commodity taxation and links optimal tax analysis to the large literature on estimating discrete choice models. The optimal tax equations that emerge highlight the role of semi-elasticities of choice probabilities to tax perturbations in shaping optimal taxes and, in particular, the implied willingness of agents to substitute from high to low taxed choices as a force dampening tax rates. We apply our approach to locational and hours choice settings. |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed019:446&r=all |
| By: | Laurens Cherchye; Thomas Demuynck; Bram De Rock; Khushboo Surana |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:ete:ceswps:622433&r=all |
| By: | Laurens Cherchye; Sam Cosaert; Bram De Rock; Pieter Jan Kerstens; Frederic Vermeulen |
| Abstract: | We propose novel tools for the analysis of individual welfare on the basis of aggregate household demand behavior. The method assumes a collective model of household consumption with the public and private nature of goods specified by the empirical analyst. A main distinguishing feature of our method is that it builds on a revealed preference characterization of the collective model that is intrinsically nonparametric. We show how to identify individual money metric welfare indices from observed household demand, along with the intrahousehold sharing rule and the individuals' willingness-to-pay for public consumption (i.e. Lindahl prices). The method is easy to use in practice and yields informative empirical results, which we demonstrate through a simulation analysis and an empirical application to labor supply data. |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:ete:ceswps:599737&r=all |