nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2006‒01‒01
six papers chosen by
Philip Yu
Hong Kong University

  1. Parametric Binary Choice Models By Michael Lechner; Stefan Lollivier; Thierry Magnac
  2. Clustering of auto supplier plants in the U.S.: GMM spatial logit for large samples By Thomas H. Klier; Dan McMillen
  3. Assessing Consumers’ Valuation of Cosmetically Damaged Apples Using a Mixed Probit Model By Yue, Chengyan; Jensen, Helen H.; Mueller, Daren S.; Nonnecke, Gail R.; Gleason, Mark L.
  4. Shelf Sequence and Proximity Effects on Online Grocery Choices By Breugelmans,Els; Campo,Katia; Gijsbrechts,Els
  5. Las preferencias individuales por el proteccionismo en "economías pequeñas", ¿fundamento racional? By Natalia Melgar; Máximo Rossi; Laura Rovegno
  6. El estado de salud de los jóvenes uruguayos By R. Todd Jewel; Patricia Triunfo; Máximo Rossi

  1. By: Michael Lechner; Stefan Lollivier; Thierry Magnac
    Abstract: This paper discusses the estimation of binary choice panel data models. We begin with different versions of the static random effects model when the explanatory variables are strictly exogenous. Depending on the autocorrelation structure of the errors, different estimators are available and we detail their attractiveness in each situation by trading-off their efficiency and robustness with respect to misspecification. Then, we consider the static model when a time invariant unobservable variable is correlated with the time varying explanatory variables. The non-linearity of binary choice models makes it pretty hard to eliminate individual fixed effects in likelihood functions and moment conditions, because the usual differencing out that works for the linear model does not work here except in special cases. Imposing quite restrictive assumptions is the price to pay to estimate consistently parameters of dynamics for fixed and random effects, in other words cases when the explanatory variables include lagged endogenous variables or are weakly exogenous only.
    JEL: C23
    Date: 2005–12
  2. By: Thomas H. Klier; Dan McMillen
    Abstract: A linearized version of Pinkse and Slade’s (1998) spatial probit estimator is used to account for the tendency of auto supplier plants to cluster together. By reducing estimation to two steps – standard probit or logit followed by two-stage least squares – linearization produces a model that can be estimated using large datasets. Our results imply significant clustering among older plants. Supplier plants are more likely to be in counties that are near assembly plants, that include interstate highways, and that are near other counties with supplier plants. New plants show no additional tendency toward clustering beyond that shown by older plants.
    Date: 2005
  3. By: Yue, Chengyan; Jensen, Helen H.; Mueller, Daren S.; Nonnecke, Gail R.; Gleason, Mark L.
    Abstract: A mixed probit model was applied to survey data to analyze consumers’ willingness to buy apples with cosmetic damage caused by the sooty blotch and flyspeck (SBFS) disease complex. The analysis finds consumers will pay a premium for organic production methods and for apples with low amounts of SBFS damage. Behavioral variables such as experience in growing fruit significantly affect the willingness to buy apples of different damage levels. Consumers’ tolerance of very blemished apples is limited and they trade off production technology attributes for cosmetic appearance. Better understanding of this trade-off is important to organic producers’ decisions about disease control.
    Keywords: apples, sooty blotch and flyspeck, organic, cosmetic damage, willingness to buy, mixed probit model.
    Date: 2005–12–28
  4. By: Breugelmans,Els; Campo,Katia; Gijsbrechts,Els (METEOR)
    Abstract: Research on traditional store shelf effects has shown that a product’s absolute and relative shelf position may strongly affect consumer choices. In this paper, we examine whether such shelf effects are still at play in an online grocery store. While traditional ‘eye-level’ placement is no longer predominant, we find that a product’s choice probability increases when presented on the first screen or located near focal (highly-preferred) items. Our results further demonstrate that these primacy and proximity effects depend on assortment size and composition. Larger and more difficult to process assortments complicate the choice process, thereby stimulating the use of shelf-based simplifying choice heuristics.
    Keywords: marketing ;
    Date: 2005
  5. By: Natalia Melgar (Departmento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Máximo Rossi (Departmento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Laura Rovegno (Departmento de Economía, Facultad de Ciencias Sociales, Universidad de la República)
    Abstract: Even when the majority of economists agree on the benefits of free trade, everywhere we turn to, trade is restricted. In contexts where politicians offer different policy options and voters demand them based on their individual preferences, one may ask what determines personal preferences on trade policy; which economic, cultural, social elements shape them. The aim of this paper is to answer these questions in the case of economies with a small domestic market, given the relative small size of their population. In this paper we use data from the module on National Identity of the 2003 International Social Survey Program (ISSP), including in our sample countries with a population of around five million inhabitants or less. Based on an ordered probit model, we conclude that the evidence does not support the conclusions on preference formation of the modelo Hecksher-Ohlin trade model, while elements such as religion, political preferences, and nationalism, as well as demographic characteristics, have a significant impact on trade policy preferences.
    Keywords: Preferencias, proteccionismo, economías pequeñas, racionalidad, ISSP.
    JEL: F13
    Date: 2005–11
  6. By: R. Todd Jewel (Deparment of Economics, University of North Texas); Patricia Triunfo (Departmento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Máximo Rossi (Departmento de Economía, Facultad de Ciencias Sociales, Universidad de la República)
    Abstract: This paper is a study of the health of young people in Uruguay. The empirical work is based on the “Health and Social Networks” survey carried out by the Department of Economics of the Social Sciences Faculty, in agreement with the National Youth Institute, in 2004. Using an ordered probit, the probability of having very good, good, or bad health status is estimated, controlled by socio-economic factors and risk-linked behavior. It is found that the probability of having better health status depends positively on education, physical activity, not being undernourished, not smoking, living in small cities, having human capital and living in a household with less relative privation. In reference to health status and the economic status of the family, the first fifteen years of life appears as positively determining it. In order to identify groups at risk, several simulations are done, predicting probabilities for several groups such as: behavior that causes a serious health risk (smoking, drinking alcohol, not doing physical excursive, being undernourished or obese), people with low socio-economic status (living in a household with high relative privation, economic problems in the first fifteen years of life, falling behind in the education system and not having human capital), and both at the same time. It has been found that those with risk behavior have a 14 per cent probability of having very good health status (as against the average, which is 24 per cent), the figure for those with low socio-economic status is 4 per cent, and the figure for those with both characteristics just 2 per cent.
    Keywords: health status, health production, human capital, youth
    JEL: I12 J24 D12
    Date: 2005–11

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