nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2016‒03‒29
nine papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. Root-N consistent estimations of time dummies for the dynamic fixed effects logit models: Monte Carlo illustrations By Yoshitsugu Kitazawa
  2. Preference for the workplace, investment in human capital, and gender By Wiswall, Matthew; Zafar, Basit
  3. Moment Inequalities for Multinomial Choice with Fixed Effects By Ariel Pakes; Jack Porter
  4. How does consumer knowledge affect environmentally sustainable choices? Evidence from a cross-country latent class analysis of food labels By Peschel, Anne; Grebitus, Carola; Steiner, Bodo; Veeman, Michele
  5. Do Financial Incentives Influence GPs’ Decisions to Do After-Hours Work? A Discrete Choice Labour Supply Model By Barbara Broadway; Guyonne Kalb; Jinhu Li; Anthony Scott
  6. Corporate taxation and location of intangible assets: Patents vs. trademarks By Dudar, Olena; Voget, Johannes
  8. Where Did it Go Wrong ?Marriage and Divorce in Malawi By Laurens Cherchye; Bram De Rock; Selma Telalagic Walther; Frederic Vermeulen
  9. Dynamic Adaptive Mixture Models By Leopoldo Catania

  1. By: Yoshitsugu Kitazawa (Faculty of Economics, Kyushu Sangyo University)
    Abstract: This paper illustrates the feasibility of the root-N consistent estimations of time dummies for both dynamic fixed effects logit models with strictly exogenous continuous explanatory variables and with no explanatory variable by using some Monte Carlo experiments. The illustrations not only imply the direct rebuttal to the generalization of Hahn fs (2001) suggestion, but also pave the way for fathoming the time effects in dynamic binary choice panel data models in a breeze.
    Keywords: dynamic fixed effects logit models; time dummies; root-N consistent GMM estimators; Monte Carlo
    JEL: C23 C25
    Date: 2016–03
  2. By: Wiswall, Matthew (Arizona State University); Zafar, Basit (Federal Reserve Bank of New York)
    Abstract: In this paper, we use a hypothetical choice methodology to robustly estimate preferences for workplace attributes. Undergraduate students are presented with sets of jobs that vary in their attributes (such as earnings and job hours flexibility) and asked to state their probabilistic choices. We show that this method robustly identifies preferences for various job attributes, free from omitted variable bias and free from considering the equilibrium matching of workers to jobs. While there is substantial heterogeneity in preferences, we find that women, on average, have a higher willingness to pay for jobs with greater work flexibility (lower hours, and part-time option availability) and job stability (lower risk of job loss), while men have a higher willingness to pay for jobs with higher earnings growth. In the second part of the paper, using data on students’ perceptions about the types of jobs that would be offered to them conditional on their college major choices, we relate these job attribute preferences to major choice. We find that students perceive jobs offered to humanities majors to have fewer hours, more worktime flexibility, and higher stability than jobs offered to economics/business majors. These job attributes are found to play a role in major choice, with women exhibiting greater sensitivity to nonpecuniary job attributes in major choice.
    Keywords: workplace preferences; compensating differentials; human capital; college majors; gender
    JEL: J16 J24
    Date: 2016–03–01
  3. By: Ariel Pakes; Jack Porter
    Abstract: We propose a new approach to semiparametric analysis of multinomial choice models with fixed effects and a group (or panel) structure. A traditional random utility framework is employed, and the key assumption is a group homogeneity condition on the disturbances. This assumption places no restrictions on either the joint distribution of the disturbances across choices or within group (or across time) correlations. This work follows a substantial nonlinear panel literature (Manski 1987, Honore 1992, Abrevaya 1999, 2000) with the distinction that multiple covariate index functions now determine the outcome. A novel within-group comparison leads to a set of conditional moment inequalities that provide partial identifying information about the parameters of the observed covariate index functions, while avoiding the incidental parameter problem. We extend our framework to allow for: certain types of endogenous regressors (including lagged dependent variables and conditional heteroskedasticity), set-valued covariates, and parametric distributional information on disturbances.
    JEL: C14 C23 C25
    Date: 2016–01
  4. By: Peschel, Anne; Grebitus, Carola; Steiner, Bodo; Veeman, Michele
    Abstract: This paper examines consumers' knowledge and lifestyle profiles and preferences regarding two environmentally labelled food staples, potatoes and ground beef. Data from online choice experiments conducted in Canada and Germany are analyzed through latent class choice modelling to identify the influence of consumer knowledge (subjective and objective knowledge as well as usage experience) on environmentally sustainable choices. We find that irrespective of product or country under investigation, high subjective and objective knowledge levels drive environmentally sustainable food choices. Subjective knowledge was found to be more important in this context. Usage experience had relatively little impact on environmentally sustainable choices. Our results suggest that about 20 % of consumers in both countries are ready to adopt footprint labels in their food choices. Another 10 - 20% could be targeted by enhancing subjective knowledge, for example through targeted marketing campaigns.
    Keywords: carbon footprint; food; latent class analysis; objective knowledge; subjective knowledge; water footprint
    JEL: D12 M31 Q51
    Date: 2016–02–27
  5. By: Barbara Broadway (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne; and ARC Centre of Excellence for Children and Families Over the Life Course); Guyonne Kalb (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne; ARC Centre of Excellence for Children and Families Over the Life Course; Institute for the Study of Labour (IZA)); Jinhu Li (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne; and ARC Centre of Excellence for Children and Families Over the Life Course); Anthony Scott (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)
    Abstract: This paper analyses doctors’ supply of after-hours care, and how it is affected by personal and family circumstances as well as the earnings structure. We use detailed survey data from a large sample of Australian General Practitioners to estimate a structural, discrete-choice model of labour supply and after-hours care. This allows us to jointly model how many daytime-weekday hours a doctor works, and his or her probability of providing after-hours care. The underlying utility function varies across individual and family characteristics. We simulate labour supply responses to an increase in doctors’ hourly earnings, both in a daytime-weekday setting and for after-hours care. Among doctors overall, men and women increase their daytime-weekday working hours if their hourly earnings in this setting increases, but only to a very small extent. Men’s labour supply elasticities do not change if their family circumstances change, but for women the small behavioural response disappears completely if they have preschool-aged children. Doctors are somewhat more likely to provide after-hours care if their hourly earnings in that setting increases, but again the effect is very small and is only evident in some sub-groups. Moreover, higher earnings in weekday-daytime practice reduces the probability of providing after-hours care, particularly for men. Increasing doctors’ earnings appears to be at best relatively ineffective in encouraging increased provision of after-hours care, and may even prove harmful if incentives are not well-targeted.
    Keywords: Labour supply, after-hours care, wage elasticity, health workforce, MABEL
    JEL: I11 J22 J44 J21
    Date: 2016–03
  6. By: Dudar, Olena; Voget, Johannes
    Abstract: Numerous empirical studies have analysed the influence of corporate taxation on the location of intangible assets within a company group. However, the previous literature has rather focused on studying the impact of taxation on patent location choices assuming that these assets represent the rest of intangibles as well. This paper complements previous studies by estimating and comparing the tax elasticities of two different types of intangibles - patents and trademarks. We employ data on European and US patent and trademark applications in the period of 1996-2012 and estimate a multinomial logit model that incorporates various observed and unobserved factors of the intangible's location choice. According to our main findings, trademarks are more sensitive to changes in taxation as compared to patents. This implies that firms use trademarks more eagerly for tax planning purposes than patents.
    Keywords: intangible assets,patent,trademark,tax planning,corporate taxation
    JEL: H25 F23 H26 H3
    Date: 2016
  7. By: Luz Adriana Pineda Barón
    Abstract: Uno de los problemas que influyen en la formación de capital humano es la inadecuada elección de carrera. Esta elección está altamente condicionada a la certeza vocacional que el estudiante tiene al momento de culminar sus estudios de secundaria. El objetivo de este trabajo es encontrar a través de un Modelo Logit Multinomial los factores individuales, socioeconómicos, académicos, de preferencias y de expectativas salariales que afectaron la elección de un programa académico de educación superior, de los estudiantes que presentaron la Prueba Saber 11 en el primer periodo del año 2009 y la Prueba Saber Pro en el segundo periodo del año 2013, matriculados en un programa de modalidad presencial en Bogotá. Se encuentra que la elección de carrera está asociada al género, a la educación superior de la madre del estudiante, a los ingresos familiares, a los resultados de la Prueba Saber 11, discriminada por áreas y a las expectativas salariales.
    Keywords: Capital humano, elección de carrera, Modelo Logit Multinomial, probabilidad, relación de riesgo relativo.
    JEL: C25 I23 I25
    Date: 2015–10–20
  8. By: Laurens Cherchye; Bram De Rock; Selma Telalagic Walther; Frederic Vermeulen
    Abstract: Do individuals divorce for economic reasons? Can we measure theattractiveness of new matches in the marriage market? We answer thesequestions using a structural model of the household and a rich panel datasetfrom Malawi. We propose a model of the household with consumption,production and revealed preference conditions for stability on the marriagemarket. We define marital instability in terms of the consumption gains toremarrying another individual in the same marriage market, and to beingsingle. We find that a 1 percentage point increase in the wife's estimatedconsumption gains from remarriage is significantly associated with a 0.6percentage point increase in divorce probability in the next three years. Ina multinomial model, higher values of consumption gains from remarriageraise the odds of divorce and remarriage but not of divorce and singleness.These findings provide out-of-sample validation of the structural model andshed new light on the economic determinants of divorce.
    Keywords: marriage market; divorce; Malawi; agricultural production; revealed preference
    JEL: D11 D12 D13 J12
    Date: 2016–03
  9. By: Leopoldo Catania
    Abstract: In this paper we propose a new class of Dynamic Mixture Models (DAMMs) being able to sequentially adapt the mixture components as well as the mixture composition using information coming from the data. The information driven nature of the proposed class of models allows to exactly compute the full likelihood and to avoid computer intensive simulation schemes. An extensive Monte Carlo experiment reveals that the new proposed model can accurately approximate the more complicated Stochastic Dynamic Mixture Model previously introduced in the literature as well as other kind of models. The properties of the new proposed class of models are discussed through the paper and an application in financial econometrics is reported.
    Date: 2016–03

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