nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2015‒08‒19
six papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  2. Local government cooperation at work: A control function approach By Zineb Abidi; Edoardo Di Porto; Angela Parenti; Sonia Paty
  3. Addressing empirical challenges related to the incentive compatibility of stated preference methods By Wiktor Budziński; Mikołaj Czajkowski; Christian A. Vossler; Aleksandra Wiśniewska; Ewa Zawojska
  4. Physical Activity in School Travel: A Cross-Nested Logit Approach By Alireza Ermagun; David Levinson
  5. Energy efficiency determinants: An empirical analysis of Spanish innovative firms By Costa, M. Teresa (Maria Teresa), 1951-; García, José, 1963-; Segarra Blasco, Agustí, 1958-
  6. Choice experiment assessment of public preferences for forest structural attributes By Per Angelstam; Mikołaj Czajkowski; Marek Giergiczny; Tomasz Żylicz

  1. By: Nathalie Picard (Department of Economics, Ecole Polytechnique - CNRS - Polytechnique - X, THEMA - Théorie économique, modélisation et applications - Université de Cergy Pontoise - CNRS); Constantinos Antoniou (National Technical University of Athens)
    Abstract: Typically, urban development models have been based on aggregate principles. UrbanSim (Waddell et al. 2003) is among a new breed of models that use microsimulation in an effort to overcome the limitations of earlier models and provide a more dynamic and detailed paradigm. The advantages and disadvantages of using microsimulation are not within the scope of this chapter, but the main implication is that more data, as well as more detailed ones are required for microsimulation than for aggregate models. In the context of the SustainCity project (, three European cities (Brussels, Paris and Zürich, described in other chapters of this handbook) have been modelled using the land use microsimulation platform UrbanSim. This platform relies on various models interacting with each other, to predict long–term urban development. The aim of this chapter is to provide some econometric insight into this process. A common set of notations and assumptions are first defined, and the more common model structures (linear regression, multinomial logit, nested logit, mixed MNL and latent variable models) are described in a consistent way. Special treatments and approaches that are required due to the specific nature of the data in this type of applications (i.e. involving very large number of alternatives, and often exhibiting endogeneity, correlation, and (pseudo–)panel data properties) are discussed. For example, importance sampling, spatial econometrics, Geographically Weighted Regression (GWR) and endogeneity issues are covered. Specific examples of the following models: (i) household location choice model, (ii) jobs location/firmography, (iii) real estate price model, and (iv) land developmentmodel, are demonstrated in the context of the case studies in Brussels, Paris and Zürich. Finally, lessons learned in relation to the econometric models from these case studies are summarized.
    Date: 2014–12–08
  2. By: Zineb Abidi (CREM - Centre de Recherche en Economie et Management - CNRS - Université de Caen Basse-Normandie - UR1 - Université de Rennes 1); Edoardo Di Porto (University of Naples Federico II [Naples] - University of Naples Federico II); Angela Parenti (IMT Institute of Advanced Studies); Sonia Paty (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - CNRS - UCBL - Université Claude Bernard Lyon 1 - UL2 - Université Lumière - Lyon 2 - Université Jean Monnet - Saint-Etienne - PRES Université de Lyon - ENS Lyon - École normale supérieure - Lyon)
    Abstract: Abstract.We analyze voluntary coalition formation using a unique panel data for 1,056 municipalities in the French region of Brittany between 1995 and 2002. We use a control function approach to develop a binary discrete choice model with spatial interactions. We find that a municipality’s decision to cooperate over the provision local public goods depends on the decisions of its neighbours. Comparison with spatial econometrics models (SAR and Durbin) shows that the decision to cooperate is over estimated by these more traditional models. The results are in line with the recent applied spatial economics literature but are derived for a discrete choice model setting.
    Date: 2014
  3. By: Wiktor Budziński (Faculty of Economic Sciences, University of Warsaw); Mikołaj Czajkowski (Faculty of Economic Sciences, University of Warsaw); Christian A. Vossler (Department of Economics, Howard H. Center for Public Policy, University of Tennessee); Aleksandra Wiśniewska (Faculty of Economic Sciences, University of Warsaw); Ewa Zawojska (Faculty of Economic Sciences, University of Warsaw)
    Abstract: An emerging theoretical literature focused on the incentive compatibility of stated preference surveys offers a new lens through which to view extant evidence on external validity, and provides guidance for practitioners. However, critical theoretical assumptions rest on latent respondent beliefs, such as the belief that respondents view surveys as potentially influencing policy (i.e., policy consequentiality), which gives rise to pressing empirical challenges. In this study, we develop a Hybrid Mixed Logit model capable of integrating multiple latent beliefs, and subjective measures of these beliefs, into discrete choice models of stated preferences. Further, we provide a split-sample test of the effects of exogenous information signals related to policy consequentiality. Our results suggest some potential for researchers to induce desired beliefs through simple information signals and, importantly, that latent beliefs and information signals significantly influence elicited willingness to pay.
    Keywords: discrete choice experiment; stated preferences; consequentiality; field experiment; hybrid mixed logit model
    JEL: C93 C35 H41 Q51
    Date: 2015
  4. By: Alireza Ermagun; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota)
    Abstract: This paper considers school access by both active (walk, bike), quasi-active (walk to transit) and non-active modes (car) in a two-level cross-nested logit framework. A sample of 3,272 middle and high school students was collected in Tehran. The results of the cross-nested logit model suggest that for people who choose walking, increasing a 1 percent in home-to-school distance reduces the probability of walking by 3.51 percent. While, this reduction is equal to 2.82 and 2.27 percent as per the multinomial and nested logit models, respectively. This is a direct consequence of the model specification that results in underestimating the effect of distance by 1.24 percent. It is also worth mentioning that, a one percent increase in home-to-school distance diminishes the probability of taking public transit by 1.04 among public transit users, while increases the probability of shifting to public transit from walking by 1.39 percent. Further, a one percent increase of the distance to public transport, decreases the probability of students' physical activity, approximately, 0.04 percent.
    Keywords: Public Transit; Active Mode of Travel; School Trips; Tehran
    JEL: C35 I12 J13 R14 R41 R42 R53
    Date: 2015
  5. By: Costa, M. Teresa (Maria Teresa), 1951-; García, José, 1963-; Segarra Blasco, Agustí, 1958-
    Abstract: This paper examines the extent to which innovative Spanish firms pursue improvements in energy efficiency (EE) as an objective of innovation. The increase in energy consumption and its impact on greenhouse gas emissions justifies the greater attention being paid to energy efficiency and especially to industrial EE. The ability of manufacturing companies to innovate and improve their EE has a substantial influence on attaining objectives regarding climate change mitigation. Despite the effort to design more efficient energy policies, the EE determinants in manufacturing firms have been little studied in the empirical literature. From an exhaustive sample of Spanish manufacturing firms and using a logit model, we examine the energy efficiency determinants for those firms that have innovated. To carry out the econometric analysis, we use panel data from the Community Innovation Survey for the period 2008â€2011. Our empirical results underline the role of size among the characteristics of firms that facilitate energy efficiency innovation. Regarding company behaviour, firms that consider the reduction of environmental impacts to be an important objective of innovation and that have introduced organisational innovations are more likely to innovate with the objective of increasing energy efficiency. Keywords: energy efficiency, corporate targets, innovation, Community Innovation Survey. JEL Classification: Q40, Q55, O31
    Keywords: Energia, Economia ambiental, Tecnologia -- Innovacions, Empreses -- Espanya -- Aspectes ambientals, 33 - Economia, 504 - Ciències del medi ambient,
    Date: 2015
  6. By: Per Angelstam (Forest-Landscape-Society Research Network, Swedish University of Agricultural Sciences); Mikołaj Czajkowski (Faculty of Economic Sciences, University of Warsaw); Marek Giergiczny (Faculty of Economic Sciences, University of Warsaw); Tomasz Żylicz (Faculty of Economic Sciences, University of Warsaw)
    Abstract: The objectives of forest policy have been broadened from tangible products, such as wood and fiber, to ecosystem services. This broadening emphasizes the need to also estimate the value of biodiversity and the social benefits of tourism and recreation. While research on the species’ requirements has a long history, the issue of which habitat humans select to engage in tourism and recreation lags behind. In both cases, a major challenge is to consider the complete range of forest structure from a managed to a natural dynamic. Combining the approach used in landscape research with non-market valuation techniques, the aim of this study is to document human habitat selection for recreational purposes in a gradient of forest naturalness. The results indicate that respondents prefer older stands with vertical layering, irregularly spaced trees and a greater number of tree species. Our study thus indicates that forests that are managed (or left unmanaged) for biodiversity purposes are also likely to be attractive to humans. To conclude, while greater management intensity was associated with higher disutility regardless of the model employed, we do not perceive a risk of conflict between forest management designed to protect biodiversity and management targeting recreational value. Consequently, there is a need for spatially differentiated forest management that discriminates among different functions. The state ownership of all larger Polish forest massifs makes this zoning approach feasible.
    Keywords: social preferences, forest characteristics, forest management, discrete choice experiment, multifunctional forestry
    JEL: Q51 Q53 Q56
    Date: 2015

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