nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2014‒12‒29
one paper chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. Controlling for the effects of information in a public goods discrete choice model By Mikolaj Czajkowski; Nick Hanley; Jacob LaRiviere

  1. By: Mikolaj Czajkowski (Faculty of Economic Sciences, University of Warsaw, Poland); Nick Hanley (School of Geography and Sustainable Development, University of St. Andrews); Jacob LaRiviere (Department of Economics, University of Tennessee)
    Abstract: This paper develops a reduced form method of controlling for differences in information sets of subjects in public good discrete choice models, using stated preference data. The main contribution of our method comes from accounting for the effect of information provided during a survey on the mean and the variance of individual-specific scale parameters. In this way we incorporate both scale heterogeneity as well as observed and unobserved preference heterogeneity to investigate differences across an d within information treatments. Our approach will also be useful to researchers who want to combine stated preference data sets while controlling for scale differences. We illustrate our approach using the data from a discrete choice experiment study of a biodiversity conservation program and find that the mean of individual -specific scale parameters and its variance in the sample is sensitive to the information set provided to the respondents.
    Keywords: information, uncertainty, choice modelling, information effects, scale, scale heterogeneity, G-MNL, combined datasets
    JEL: Q51 C51 D03 D83 D61
    Date: 2014–07

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