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on Discrete Choice Models |
| By: | Dante Amengual (CEMFI, Centro de Estudios Monetarios y Financieros); Gariele Fiorentini (Università di Firenze and RCEA); Enrique Sentan (CEMFI, Centro de Estudios Monetarios y Financieros) |
| Abstract: | We show that the influence functions of the information matrix test for the multinomial logit model are the Kronecker product of the outer product of the generalised residuals minus their covariance matrix conditional on the explanatory variables times the outer product of those variables. Thus, it resembles a multivariate heteroskedasticity test à la White (1980), which confirms Chesher’s (1984) unobserved heterogeneity interpretation. Our simulation experiments indicate that using theoretical expressions for the conditional covariance matrices involved substantially reduces size distortions, while the parametric bootstrap practically eliminates them. We also show that the test has good power against several relevant alternatives. |
| Keywords: | Hessian matrix, outer product of the score, specification test, unobserved heterogeneity. |
| JEL: | C35 C25 |
| Date: | 2024–06 |
| URL: | http://d.repec.org/n?u=RePEc:cmf:wpaper:wp2024_2406&r=dcm |
| By: | Assenza, Tiziana; Cardaci, Alberto; Huber, Stefanie |
| Abstract: | This paper investigates and quantifies citizens’ susceptibility to fake news and assesses, using a randomized control trial, the effectiveness of a policy intervention to raise awareness. We find that the average citizen lacks proficiency in identifying fake news and harbors an inflated perception of his/her ability to differentiate between true and fake news content. Increasing awareness by providing information about personal susceptibility to fall for fake news causally adjusts individuals’ beliefs about their fake news detection ability. Most importantly, we show that the simple intervention of informing citizens about their personal susceptibility to fall for fake news causally increases their willingness to pay for the fact-checking service. |
| Keywords: | Fake news; misinformation; disinformation; fact checking; information provision experiments; belief updating; willingness to pay |
| JEL: | C83 D83 D84 D91 |
| Date: | 2024–03–27 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:129250&r=dcm |
| By: | Kirill Evdokimov; Andrei Zeleneev |
| Abstract: | We develop a practical way of addressing the Errors-In-Variables (EIV) problem in the Generalized Method of Moments (GMM) framework. We focus on the settings in which the variability of the EIV is a fraction of that of the mismeasured variables, which is typical for empirical applications. For any initial set of moment conditions our approach provides a “corrected” set of moment conditions that are robust to the EIV. We show that the GMM estimator based on these moments is √n-consistent, with the standard tests and confidence intervals providing valid inference. This is true even when the EIV are so large that naive estimators (that ignore the EIV problem) are heavily biased with their confidence intervals having 0% coverage. Our approach involves no nonparametric estimation, which is especially important for applications with many covariates, and settings with multivariate or non-classical EIV. In particular, the approach makes it easy to use instrumental variables to address EIV in nonlinear models. |
| Date: | 2024–04–08 |
| URL: | http://d.repec.org/n?u=RePEc:azt:cemmap:05/24&r=dcm |
| By: | Te Bao; John Duffy; Nobuyuki Hanaki |
| Abstract: | In the digital age, privacy in economic activities is increasingly threatened. In considering policies to address this threat, it is useful to consider what value, if any, that people attach to privacy in economic activities. We study this question by eliciting individuals’ willingness to pay (WTP) to avoid detection in an economic experiment involving a coin-flipping task. We collect data from Japan, China, and the U.S.A. to examine whether there are cross-country differences. Our findings reveal that people’s WTP to “avoid the spotlight” is positive and economically sizable across all three countries and is the largest in Japan. |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:1238&r=dcm |
| By: | Zan Fairweather (Reserve Bank of Australia); Denzil Fiebig (University of New South Wales); Adam Gorajek (Reserve Bank of Australia); Rochelle Guttmann (Reserve Bank of Australia); June Ma (Harvard University); Jack Mulqueeney (Reserve Bank of Australia) |
| Abstract: | This paper explores the merits of introducing a retail central bank digital currency (CBDC) in Australia, focusing on the extent to which consumers would value having access to a digital form of money that is even safer and potentially more private than commercial bank deposits. To conduct our exploration we run a discrete choice experiment, which is a technique designed specifically for assessing public valuations of goods without markets. The results suggest that the average consumer attaches no value to the added safety of a CBDC. This is consistent with bank deposits in Australia already being perceived as a safe form of money, and physical cash issued by the Reserve Bank of Australia continuing to be available as an alternative option. Privacy settings of a CBDC, which can take various forms, look more consequential for the CBDC value proposition. We find no clear relationship between safety or privacy valuations and the degree of consumers' cash use. |
| Keywords: | central bank digital currency; data privacy; financial safety; willingness to pay |
| JEL: | C90 E42 E50 G21 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:rba:rbardp:rdp2024-02&r=dcm |
| By: | José María Durán-Cabré (Universitat de Barcelona & IEB); Alejandro Esteller-Moré (Universitat de Barcelona & IEB); Leonzio Rizzo (Università degli Studi di Ferrara & IEB); Riccardo Secomandi (University of Ferrara) |
| Abstract: | The Covid-19 vaccination campaign can be regarded as a public-sector success story. Given the shock caused by the pandemic, the visible and successful response of the public authorities regarding vaccination might have elicited an increase in the public’s trust. We test whether the vaccination process has increased the marginal willingness to pay taxes (MWTP). Taking advantage of the different paths of vaccination in Spain, we pursue a difference-in-difference empirical strategy, complemented by an event study, to infer causality running from vaccination to MWTP. We find an increase in MWTP caused by the good governance related to vaccination. |
| Keywords: | Survey data, marginal willingness to pay, DiD, event study, Covid-19 |
| JEL: | D72 H20 H26 H30 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ieb:wpaper:doc2023-08&r=dcm |
| By: | Pham, Hien |
| Abstract: | A monopolistic seller jointly designs allocation rules and (new) information about a pay-off relevant state to a buyer with private types. When the new information flips the ranking of willingness to pay across types, a screening menu of prices and threshold disclosures is optimal. Conversely, when its impact is marginal, bunching via a single posted price and threshold disclosure is (approximately) optimal. While information design expands the scope for random mechanisms to outperform their deterministic counterparts, its presence leads to an equivalence result regarding sequential versus. static screening. |
| Keywords: | mechanism design, information design, sequential screening, random mechanisms, bunching. |
| JEL: | D42 D82 D86 L15 |
| Date: | 2023–04–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:120462&r=dcm |
| By: | Pham, Hien |
| Abstract: | A monopolistic seller jointly designs allocation rules and (new) information about a pay-off relevant state to a buyer with private types. When the new information flips the ranking of willingness to pay across types, a screening menu of prices and threshold disclosures is optimal. Conversely, when its impact is marginal, bunching via a single posted price and threshold disclosure is (approximately) optimal. While information design expands the scope for random mechanisms to outperform their deterministic counterparts, its presence leads to an equivalence result regarding sequential versus. static screening. |
| Keywords: | mechanism design, information design, sequential screening, random mechanisms, bunching. |
| JEL: | D42 D82 D86 L15 |
| Date: | 2023–04–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:120364&r=dcm |
| By: | Ayden Higgins (Unknown); Koen Jochmans (TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | This paper provides new identification results for finite mixtures of Markov processes. Our arguments yield identification from knowledge of the cross-sectional distribution of three (or more) effective time-series observations under simple conditions. We explain how our approach and results are different from those in previous work by Kasahara and Shimotsu (2009) and Hu and Shum (2012). Most notably, outside information, such as monotonicity restrictions that link conditional distributions to latent types, is not needed. |
| Keywords: | discrete choice, heterogeneity, Markov process, mixture, state dependence |
| Date: | 2023–11 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04251997&r=dcm |
| By: | D. Louis; C. Lombart (Audencia Business School) |
| Abstract: | This study investigates the impact of a water brand's CSR message highlighting the brand's environmental concerns on brand-related variables (attitude towards the brand and CSR) and consumer-related variables (consumer efforts to adopt sustainable behaviours and well-being). A research model is proposed, and the relationships postulated are tested on 414 French consumers. The study establishes the effectiveness of this kind of CSR messaging in influencing French consumers to purchase and recommend a particular brand. It then shows the direct and indirect ways in which a brand's CSR messaging can improve consumers' behavioural intentions (i.e. intentions to purchase the brand's products and to recommend the brand and/or its products). It also underscores that brand-related variables contribute to increasing brands', and thus companies', business performance, whereas consumer-related variables contribute to increasing their social performance. Finally, the REBUS-PLS method emphasises the existence of several consumer groups and identifies the core target customer groups on which companies should focus their communication efforts. |
| Keywords: | CSR, CSR message, sustainable behaviours, purchase intentions, well-being |
| Date: | 2024–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04386727&r=dcm |