nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2014‒05‒17
ten papers chosen by
Edoardo Marcucci
Universita' di Roma Tre

  1. Joint econometric models of freight transport chain and shipment size choice By Abate, Megersa; Vierth, Inge; de Jong , Gerard
  2. Ethical Consumption and Social Context: Experimental Evidence from Germany and the United States By Ulf Liebe; Veronika A. Andorfer; Patricia A. Gwartney; Jürgen Meyerhoff
  3. Modeling fuel choice among households in northern Cameroon By Nlom, Jean Hugues; Karimov, Aziz
  4. Employment status and perceived health condition: longitudinal data from Italy By Minelli, Liliana; Pigini, Claudia; Chiavarini, Manuela; Bartolucci, Francesco
  5. Elicitation formats and the WTA/WTP gap: A study of climate neutral foods By Drichoutis, Andreas C.; Lusk, Jayson; Pappa, Valentina
  6. Banking Fragility in Colombia: An Empirical Analysis Based on Balance Sheets By Ignacio Lozano; Alexander Guarín
  7. Consume now or later? Time inconsistency, collective choice and revealed preference By Abi Adams; Laurens Cherchye; Bram De Rock; Ewout Verriest
  8. A New Formulation for Latent Class Models By Sarah Brown; William Greene; Mark N. Harris
  9. “EMU sovereign debt market crisis: Fundamentals-based or pure contagion?” By Marta Gómez-Puig; Simón Sosvilla-Rivero
  10. Empirical Revealed Preference By Ian Crawford; Bram De Rock

  1. By: Abate, Megersa (VTI); Vierth, Inge (VTI); de Jong , Gerard (Significance)
    Abstract: In freight transportation, decisions regarding the choice of transport mode (or chains of modes) and shipment size are closely linked. Building on this basic insight, in this paper we estimate and review various joint econometric models using the Swedish National Commodity Flow surveys. Robust parameter estimates from this exercise will be used to update the current deterministic Swedish national freight model system (the SAMGODS model) to a stochastic one.
    Keywords: Discrete–continuous models; Mode choice; Shipment size choice; Freight; Modeling
    JEL: L91 R00
    Date: 2014–05–12
  2. By: Ulf Liebe; Veronika A. Andorfer; Patricia A. Gwartney; Jürgen Meyerhoff
    Abstract: This research examines the role of social context in ethical consumption, specifically, the extent to which anonymity and social control influence individuals' decisions to purchase organic and Fair Trade coffee. Our research design overcomes biases of prior research by combining framing and discrete choice experiments in a survey. We systematically vary coffee growing method (organic or not), import status (Fair Trade or not), flavor, and price across four social contexts that vary in degree of anonymity and normative social control. The social contexts are buying coffee online, in a large grocery store, in a small neighborhood shop, and for a meeting of a human rights group. Subjects comprise 1,103 German and American undergraduate students. We find that social context indeed influences subjects' ethical consumer decisions, especially in situations with low anonymity and high social control. In addition, gender, coffee buying, and subjective social norms trigger heterogeneity regarding stated ethical consumption and the effects of social context. These results suggest previous research has underestimated the relevance of social context for ethical consumption and overestimated altruistic motives of ethical consumers. Our study demonstrates the great potential of discrete choice experiments for the study of social action and decision making processes in sociology.
    Keywords: ethical consumption, choice experiment, framing effect, social context, social norms
    Date: 2014–04–26
  3. By: Nlom, Jean Hugues; Karimov, Aziz
    Abstract: The present study aims to explore economic and socio-demographic factors that influence the household.s probability to switch from firewood to clean fuels in northern Cameroon. The paper employs an ordered probit model to construct cooking patterns and fu
    Keywords: Cameroon, firewood, clean fuels, ordered probit model
    Date: 2014
  4. By: Minelli, Liliana; Pigini, Claudia; Chiavarini, Manuela; Bartolucci, Francesco
    Abstract: The considerable increase of non-standard labor contracts, unemployment and inactivity rates raises the question of whether job insecurity and the lack of job opportunities affect physical and mental well-being differently from being employed with an open-ended contract. In this paper we offer evidence on the relationship between Self Reported Health Status (SRHS) and the employment status in Italy using the Survey on Household Income and Wealth; another aim is to investigate whether these potential inequalities have changed with the recent economic downturn (time period 2006-2010). We estimate an ordered logit model with SRHS as response variable based on a fixed-effects approach which has certain advantages with respect to the random-effects formulation and has not been applied before with SRHS data. The fixed-effects nature of the model also allows us to solve the problems of incidental parameters and non-random selection of individuals into different labor market categories. We find that temporary workers, unemployed and inactive individuals are worse off than permanent employees, especially males, young workers, and those living in the center and south of Italy. Health inequalities between unemployed/inactive and permanent workers widen over time for males and young workers, and arise in the north of the country as well.
    Keywords: self-reported health status, employment status, economic crisis, fixed-effects ordered logit model
    JEL: I10 J60 J70
    Date: 2014–03
  5. By: Drichoutis, Andreas C.; Lusk, Jayson; Pappa, Valentina
    Abstract: We conduct a field valuation experiment where we vary the valuation method (contingent valuation vs. inferred valuation) as well as the payment format (dichotomous choice vs. payment card). Willingness-to-accept and willingness-to-pay valuations are elicited in a within-subjects design for foods with climate neutral labels. We find a similar gap for valuations elicited with the contingent or the inferred valuation method. However, we also find that the gap can be muted by using a payment card elicitation format.
    Keywords: willingness to pay; willingness to accept; contingent valuation; inferred valuation; payment card; single bounded
    JEL: C93 D12
    Date: 2014–05–08
  6. By: Ignacio Lozano; Alexander Guarín
    Abstract: In this paper, we study the empirical relationship between credit funding sources and the financial vulnerability of the Colombian banking system. We propose a statistical model to measure and predict banking-fragility episodes associated with credit funding sources classified into retail deposits and wholesale funds. We compute the probability of financial fragility for both the aggregated banking system and the individual banks. Our approach performs a Bayesian averaging of estimated logit regression models with monthly balance sheet data between 1996 and 2013. The results show the increasing use of wholesale funding to support credit expansion is a potential source of financial fragility. Therefore, monitoring credit funding sources could provide an additional tool to warn against banking disruptions.
    Keywords: Credit cycle, financial stability, wholesale funds, balance sheet, logistic model regression, Bayesian model averaging.
    JEL: C11 C23 C52 C53 G01 G20 G21
    Date: 2014–03–12
  7. By: Abi Adams (Institute for Fiscal Studies); Laurens Cherchye (Institute for Fiscal Studies and University of Leuven); Bram De Rock (Institute for Fiscal Studies); Ewout Verriest
    Abstract: In this paper, we develop a revealed preference methodology that allows us to explore whether time inconsistencies in household choice are the product of individual preference nonstationarities or the result of individual heterogeneity and renegotiation within the collective unit. An empirical application to household-level microdata highlights that an explicit recognition of the collective nature of household choice enables the vast majority of observed behaviour to be rationalised by a theory that assumes preference stationarity at the individual level. The methodology created in this paper also facilitates the recovery of theory-consistent discount rates for each individual within a particular household under study. We find that couples characterised by lower divergence in spousal discount rates are older, which we take as an indication of experiencing higher match quality.
    Date: 2014–05
  8. By: Sarah Brown (Economics Department, University of Sheffield); William Greene (Economics Department, Stern Business School, New York University); Mark N. Harris (School of Economics and Finance, Curtin University)
    Abstract: Latent class, or finite mixture, modelling has proved a very popular, and relatively easy, way of introducing much-needed heterogeneity into empirical models right across the social sciences. The technique involves (probabilistically) splitting the population into a finite number of (relatively homogeneous) classes, or types. Within each of these, typically, the same statistical model applies, although these are characterised by differing parameters of that distribution. In this way, the same explanatory variables can have differing effects across the classes, for example. A priori, nothing is known about the behaviours within each class; but ex post, researchers invariably label the classes according to expected values, however defined, within each class. Here we propose a simple, yet effective, way of parameterising both the class probabilities and the statistical representation of behaviours within each class, that simultaneously preserves the ranking of such according to class-specific expected values and which yields a parsimonious representation of the class probabilities.
    Keywords: latent class models; finite mixture models; ordered probability models; expected values; body mass index
    JEL: C3 D1 I1
    Date: 2014–04
  9. By: Marta Gómez-Puig (Faculty of Economics, University of Barcelona); Simón Sosvilla-Rivero (Department of Quantitative Economics, Universidad Complutense de Madrid)
    Abstract: We empirically investigate whether the transmission of the recent crisis in euro area sovereign debt markets was due to fundamentals-based or pure contagion. To do so, we examine the behaviour of EMU sovereign bond yield spreads with respect to the German bund for a sample of both central and peripheral countries from January 1999 to December 2012. First we apply a dynamic approach to analyse the evolution of the degree of Grangercausality within the 90 pairs of sovereign bond yield spreads in our sample, in order to detect episodes of significantly increased causality between them (which we associate with contagion) and episodes of significantly reduced interconnection (which we associate with immunisation). We then use an ordered logit model to assess the determinants of the occurrence of the episodes detected. Our results suggest the importance of variables proxying market sentiment and of variables proxying macrofundamentals in determining contagion and immunisation outcomes. Therefore, our findings underline the coexistence of “pure” and “fundamentals-based contagion” uring the recent European debt crisis.
    Keywords: Sovereign bond spreads, contagion, Granger-causality, time-varying approach, euro area, ordered logit model. JEL classification: C35, C53, E44, F36, G15
    Date: 2014–05
  10. By: Ian Crawford; Bram De Rock
    Keywords: consumption behavior; revealed preferences; nonparametric analysis
    JEL: D11 D12 D13 C14
    Date: 2013–09

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