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on Discrete Choice Models |
| By: | Richard Williams (University of Notre Dame) |
| Abstract: | Ordered logit/probit models are among the most popular ordinal regression techniques. However, these models often have serious problems. The proportional odds/parallel lines assumptions made by these methods are often violated. Further, because of the way these models are identified, they have many of the same limitations as are encountered when analyzing standardized coefficients in OLS regression, e.g., interaction terms and crosspopulation comparisons of effects can be highly misleading. This paper shows how generalized ordered logit/probit models (estimated via gologit2) and heterogeneous choice/location scale models (estimated via oglm) can often address these concerns in ways that are more parsimonious and easier to interpret than is the case with other suggested alternatives. At the same time, the paper cautions that these methods sometimes raise their own concerns that researchers need to be aware of and know how to deal with. First, misspecified models can create worse problems than the ones these methods were designed to solve. Second, estimates are sometimes implausible, suggesting that the data are being spread too thin and/or yet another method is needed. Third, multiple and very different interpretations of the same results are often possible and plausible. I will present guidelines for identifying and dealing with each of these problems. |
| Date: | 2008–07–03 |
| URL: | http://d.repec.org/n?u=RePEc:boc:dsug08:03&r=dcm |
| By: | Dominique Ami (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales - CNRS : UMR6579); Olivier Chanel (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales - CNRS : UMR6579); Frédéric Aprahamian (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales - CNRS : UMR6579); Robert-Vincent Joule (LPS - Laboratoire de Psychologie Sociale - Ecole des Hautes Etudes en Sciences Sociales); Stephane Luchini (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - Université de la Méditerranée - Aix-Marseille II - Université Paul Cézanne - Aix-Marseille III - Ecole des Hautes Etudes en Sciences Sociales - CNRS : UMR6579) |
| Abstract: | In this paper, we propose a behavioural approach to determine the extent to which the consumer/citizen distinction affects interpretations of monetary values. We perform a field experiment dealing with air pollution, where some (randomly selected) subjects are given the opportunity to behave politically by signing a petition for environmental protection prior to stating their private preferences in a standard contingent valuation exercise. We show that the petition has the potential to influence respondents' willingness to pay and that whether the effect is negative or positive depends on the degree of (dis)similarity between the petition and the scenario in which willingness to pay are elicited. We interpret the results using the theory of commitment borrowed from social psychology. |
| Keywords: | Field Experiment, Citizen, Consumer, Contingent Valuation, Willingness to pay, Commitment, Air Pollution |
| Date: | 2008–06–20 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-00289451_v1&r=dcm |