nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2008‒10‒21
five papers chosen by
Philip Yu
Hong Kong University

  1. Combining mixed logit models and random effects models to identify the determinants of willingness to pay for rural landscape improvements By Campbell, Danny
  2. Analyzing the determinants of farmers' choice of adaptation methods and perceptions of climate change in the Nile Basin of Ethiopia: By Deressa, Temesgen; Hassan, R. M.; Alemu, Tekie; Yesuf, Mahmud; Ringler, Claudia
  3. The Relevance of Irrelevant Alternatives: An experimental investigation of risky choices By Eike B. Kroll; Bodo Vogt
  4. Part-Time Sick Leave as a Treatment Method? By Andrén, Daniela; Andrén, Thomas
  5. The Italian Job: Match Rigging, Career Concerns and Media Concentration in Serie A By Boeri, Tito; Severgnini, Battista

  1. By: Campbell, Danny
    Abstract: This paper reports the findings from a discrete choice experiment study designed to estimate the economic benefits associated with rural landscape improvements in Ireland. Using a mixed logit model, the panel nature of the dataset is exploited to retrieve willingness to pay values for every individual in the sample. This departs from customary approaches in which the willingness to pay estimates are normally expressed as measures of central tendency of an a priori distribution. In a different vein from analysis conducted in previous discrete choice experiment studies, this paper uses random effects models for panel data to identify the determinants of the individual-specific willingness to pay estimates. In comparison with the standard methods used to incorporate individual-specific variables into the analysis of discrete choice experiments, the analytical approach outlined in this paper is shown to add considerably more validity and explanatory power to welfare estimates
    Keywords: Agri-environment, discrete choice experiments, mixed logit, panel data, random effects, willingness to pay, Demand and Price Analysis, Environmental Economics and Policy, C33, C35, Q24, Q51,
    Date: 2008–01–14
  2. By: Deressa, Temesgen; Hassan, R. M.; Alemu, Tekie; Yesuf, Mahmud; Ringler, Claudia
    Abstract: "This study identifies the major methods used by farmers to adapt to climate change in the Nile Basin of Ethiopia, the factors that affect their choice of method, and the barriers to adaptation. The methods identified include use of different crop varieties, tree planting, soil conservation, early and late planting, and irrigation. Results from the discrete choice model employed indicate that the level of education, gender, age, and wealth of the head of household; access to extension and credit; information on climate, social capital, agroecological settings, and temperature all influence farmers' choices. The main barriers include lack of information on adaptation methods and financial constraints. Moreover, the analysis reveals that age of the household head, wealth, information on climate change, social capital, and agroecological settings have significant effects on farmers' perceptions of climate change." from authors' abstract
    Keywords: Adaptation, Perception on climate change, Agriculture, Climate change, Nile Basin of Ethiopia,
    Date: 2008
  3. By: Eike B. Kroll (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Bodo Vogt (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg)
    Abstract: Experimental economists have discovered various violations of expected utility theory and offered alternative models that can explain laboratory results. This study discovers a new violation in risky choices that cannot be explained by theories like Prospect Theory, Disappoint- ment or Regret Theory. In an experimental setting using a between- subject design, the influence of a dominated alternative on certainty equivalents is shown. One group of subjects was offered a series of choices between a lottery ticket with a 50-50 chance of winning and a sure payoff. A second group was offered the same choice plus a third alternative, that as it turned out was not chosen by any participant. As a result, the average chosen sure payoff in the second group was higher than in the first group. That means, by adding a dominated alternative to a choice set, the certainty equivalent of a lottery is in- creased.
    Date: 2008–09
  4. By: Andrén, Daniela (Department of Economics, School of Business, Economics and Law, Göteborg University); Andrén, Thomas (National Institute of Economic Research)
    Abstract: This paper analyzes the effects of being on part-time sick leave compared to full-time sick leave on the probability of recovering (i.e., returning to work with full recovery of lost work capacity). Using a discrete choice one-factor model, we estimate mean treatment parameters and distributional treatment parameters from a common set of structural parameters. Our results show that part-time sick leave increases the likelihood of recovering and dominates full-time sick leave for sickness spells of 150 days or longer. For these long spells, the probability of recovering increases by 10 percentage points.
    Keywords: part-time sick leave; selection; unobserved heterogeneity; treatment effects
    JEL: I12 J21 J28
    Date: 2008–10–09
  5. By: Boeri, Tito (Bocconi University); Severgnini, Battista (Humboldt University, Berlin)
    Abstract: This paper contributes to the literature on competition and corruption, by drawing on records from Calciopoli, a judicial inquiry carried out in 2006 on corruption in the Italian soccer league. Unlike previous studies, we can estimate the determinants of match rigging and use this information in identifying corruption episodes in years in which there are no pending judicial inquiries. We find evidence of corruption activity well before Calciopoli. Career concerns of referees seem to play a major role in match rigging. An implication of our study is that a more transparent selection of the referees and evaluation of their performance is essential in removing incentives to match rigging. Another implication is that in presence of significant "winners-take-all" effects, more competitive balance may increase corruption unless media concentration is also significantly reduced.
    Keywords: concentration, corruption, career concerns, random effect ordered probit, Monte Carlo simulations, soccer
    JEL: D73 L82 L83
    Date: 2008–10

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