nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2012‒05‒29
three papers chosen by
Philip Yu
Hong Kong University

  1. Willingness to pay for the infrastructure investments for alternative fuel vehicles By Nobuyuki Ito; Kenji Takeuchi; Shunsuke Managi
  2. More random or more deterministic choices? The effects of information on preferences for biodiversity conservation By Czajkowski, Mikolaj; Hanley, Nicholas
  3. EDUCATION AND LABOUR MARKET OUTCOMES: EVIDENCE FROM BRAZIL By R Freguglia; G Spricigo; Geraint Johnes; A Aggarwal

  1. By: Nobuyuki Ito (Graduate School of Agriculture, Kyoto University); Kenji Takeuchi (Graduate School of Economics, Kobe University); Shunsuke Managi (Graduate School of Environmental Studies, Tohoku University)
    Abstract: This study investigates potential demand for infrastructure investment for alternative fuel vehicles (AFVs) by using a stated preference survey of 1,531 Japanese citizens. The potential demand is estimated on the basis of how much people are willing to pay for AFVs under different refueling scenarios. By using the estimated parameters, the economic efficiency of establishing battery exchange stations for electric vehicles is examined. The result indicates that infrastructural development of battery exchange stations can be socially efficient when the percentage of electric vehicle purchasers out of the total number of new vehicle purchasers exceeds 5.63%. Furthermore, in contrast to intuitive prediction, we found a complement relationship between the cruising ranges of AFVs and the infrastructures established. The result suggests that people with AFVs might change their total trip distance depending on the sufficiency of infrastructure investment.
    Keywords: Alternative fuel vehicle, infrastructure investment, stated preference method, choice experiment, discrete choice, nested logit model, cost-benefit analysis
    Date: 2012–05
  2. By: Czajkowski, Mikolaj; Hanley, Nicholas
    Abstract: For many years, stated preference researchers have been interested in the effects of information onwillingness to pay for environmental goods. Within the random utility model, information about anenvironmental good might impact on preferences and on scale (error variance), both between andwithin samples of choices. In this paper, we extend the G‐MNL model to investigate the effects ofdifferent information sets on choices over the management of biodiversity in the UK, looking specificallyat moorlands managed for red grouse shooting. Specifically, we make the individual scale parameter afunction of observable (dataset‐specific) characteristics. Our results show that changing information setsresults in significant differences in the mean scale between datasets, and in the variance of scale.Respondents are more deterministic in their choices and show lower within‐sample scale heterogeneityin the alternative information treatment. Changes in information provision also effect willingness to payestimates, reducing the value people place on the conservation of two iconic birds of prey. The methodsused will also be of interest to researchers who need to combine choice experiment data
    Keywords: choice modelling; information effects; scale; scale heterogeneity; G‐M; heather moorland management; raptor conservation; combined SP‐
    Date: 2012
  3. By: R Freguglia; G Spricigo; Geraint Johnes; A Aggarwal
    Abstract: The effect of education on labour market outcomes is analysed using both survey and administrative data from The Brazilian PNAD and RAIS-MIGRA series, respectively. Occupational destination is examined using both multinomial logit analyses and structural dynamic discrete choice modelling. The latter approach is particularly useful as a means of evaluating policy impacts over time. We find that policy to expand educational provision leads initially to an increased take-up of education, and in the longer term leads to an increased propensity for workers to enter non-manual employment.
    Date: 2011

This nep-dcm issue is ©2012 by Philip Yu. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.