nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2016‒05‒21
six papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. Integrating sensory evaluations in incentivized discrete choice experiments to assess consumer demand for cricket flour buns in Kenya By Mohammed H. Alemu; Søren Bøye Olsen; Suzanne E. Vedel; John Kinyuru; Kennedy O. Pambo
  2. Public Acceptability of Climate Change Mitigation Policies: A Discrete Choice Experiment By Milan Ščasný; Iva Zvěřinová; Mikolaj Czajkowski; Eva Kyselá; Katarzyna Zagórska
  3. Willingness to Pay for Retail Location and Product Origin of Christmas Trees By Zaffou, Madiha; Campbell, Benjamin
  4. Intertemporal discrete choice By D. Pennesi
  5. Decomposing response errors in food consumption measurement : implications for survey design from a survey experiment in Tanzania By Friedman,Jed; Beegle,Kathleen G.; De Weerdt,Joachim; Gibson,John
  6. Milk Marketing Channel Choices for Enhanced Competitiveness in The Kenya Dairy Supply Chain: A multinomial Logit Approach By Moturi, Walter; Obare, Gideon; Kahi, Alexander

  1. By: Mohammed H. Alemu (Department of Food and Resource Economics, University of Copenhagen); Søren Bøye Olsen (Department of Food and Resource Economics, University of Copenhagen); Suzanne E. Vedel (Department of Food and Resource Economics, University of Copenhagen); John Kinyuru (Department of Food Science and Technology, Jomo Kenyatta University of Agriculture and Technology, Kenya); Kennedy O. Pambo (Department of Agricultural and Resource Economics, Jomo Kenyatta University of Agriculture and Technology, Kenya)
    Abstract: In this study, we present one of the first thorough assessments of potential consumer demand for an insect based food product. We assess the demand in terms of Kenyan consumer preferences and willingness to pay for buns containing varying amounts of cricket flour. The novel feature of the study is that it uses an incentivized discrete choice experiment method integrated with sensory experiments intended to reduce any hypothetical bias and to allow participants to acquire experience in terms of tasting the different buns before they make their choices in the choice tasks. We find significant and positive preferences for the buns which contain cricket flour. Interestingly, the bun products with medium amounts of cricket flour are preferred to no or high amount of cricket flour. Finally, we show in a simulated market that the cricket flour based buns are likely to obtain a greater market shares than that of standard buns today.
    Keywords: cricket flour, insect, incentivized discrete choice experiment, taste, willingness to pay
    JEL: C13 C25 C93 D12 Q01 Q11 Q13 Q18
    Date: 2016–05
  2. By: Milan Ščasný (Charles University in Prague, Environment Center); Iva Zvěřinová (Charles University in Prague, Environment Center); Mikolaj Czajkowski (Faculty of Economic Sciences, University of Warsaw); Eva Kyselá (Charles University in Prague, Environment Center); Katarzyna Zagórska (Faculty of Economic Sciences, University of Warsaw)
    Abstract: Our study examines public acceptability of the EU’s future mitigation targets. Using the discrete choice experiment, we elicit the preferences of about 4,098 respondents from the Czech Republic, Poland, and the United Kingdom for the GHG emission reduction policies that differ in four attributes: emission reduction target, burden sharing across the EU Member States, the distribution of costs within each country, and cost. The three specific reduction targets we analysed correspond to the EU 2050 Roadmap and deep decarbonisation policy (80% target), the climate-energy 2014 targets (40% target), and the status quo policy (20% target); each will result in a specific emission trajectory by 2050. Our results reveal stark differences between the three countries. Czechs would be on average willing to pay around EUR 13 per household and year for the 40% GHG emission reductions by 2030 or EUR 17 for 80% reduction target by 2050, and the citizens of the UK are willing to pay about EUR 40. Conversely, the mean willingness to pay of the Polish household for adopting more stringent targets is not statistically different from zero. The willingness to pay for adopting 40% and 80% targets are not statistically different in any of the examined countries. However, we found that the preferences in all three countries are highly heterogeneous. In addition, we provide an insight into the preferred characteristics of the future GHG emission reduction policies.
    Keywords: discrete choice experiments; climate change mitigation policy; consumer preferences; burden sharing; cost distribution; GHG emission targets
    JEL: Q48 Q51 Q54 Q58
    Date: 2016
  3. By: Zaffou, Madiha; Campbell, Benjamin
    Abstract: Christmas trees sales are considerable throughout the U.S. Understanding the drivers of purchase for Christmas trees, especially the impact of retail outlet and local label, is critical for producers and policy makers within states with tree production. Utilizing data from a choice experiment Connecticut residents in combination with latent class modeling we find that Christmas tree height is important to all latent classes but tree species had less of an impact. Furthermore, we find that a grown in CT label does not influence all consumers, though a majority of our sample had a preferential view and would pay a premium for a CT trees. With respect to retail location, we find that nursery/greenhouse and choose and cut retail outlets are preferred by a majority of consumers, but not by all consumers. Recommendations for the varying retail outlets are provided.
    Keywords: consumer behavior, choice experiment, willingness to pay, Agribusiness, Marketing,
    Date: 2016
  4. By: D. Pennesi
    Abstract: The discounted logit is widely used to estimate time preferences using data from field and laboratory experiments. Despite its popularity, it exhibits the "problem of the scale": choice probabilities depend on the scale of the value function. When applied to intertemporal choice, the problem the scale implies that logit probabilities are sensitive to the temporal distance between the choice and the outcomes. This is a failure of an intuitive requirement of stationarity although future values are discounted geometrically. As a consequence, patterns of choice following from the structure of the logit may be attributed to non-stationary discounting. We solve this problem introducing the discounted Luce rule. It retains the flexibility and simplicity of the logit while it satisfies stationarity. We characterize the model in two settings: dated outcomes and consumption streams. Relaxations of stationarity give observable restrictions characterizing hyperbolic and quasi-hyperbolic discounting. Lastly, we discuss an extension of the model to recursive stochastic choices with the present bias.
    JEL: D01
    Date: 2016–02
  5. By: Friedman,Jed; Beegle,Kathleen G.; De Weerdt,Joachim; Gibson,John
    Abstract: There is wide variation in how consumption is measured in household surveys both across countries and over time. This variation may confound welfare comparisons in part because these alternative survey designs produce consumption estimates that are differentially influenced by contrasting types of survey response error. Although previous studies have documented the extent of net error in alternative survey designs, little is known about the relative influence of the different response errors that underpin a survey estimate. This study leverages a recent randomized food consumption survey experiment in Tanzania to shed light on the relative influence of these various error types. The observed deviation of measured household consumption from a benchmark is decomposed into item-specific consumption incidence and consumption value so as to investigate effects related to (a) the omission of any consumption and then (b) the error in value reporting conditional on positive consumption. The results show that various survey designs exhibit widely differing error decompositions, and hence a simple summary comparison of the total recorded consumption across surveys will obscure specific error patterns and inhibit the lessons for improved consumption survey design. In light of these findings, the relative performance of common survey designs is discussed, and design lessons are drawn to enhance the accuracy of item-specific consumption reporting and, consequently, the measures of total household food consumption.
    Keywords: Consumption,Regional Economic Development,Food&Beverage Industry,Economic Theory&Research,Rural Poverty Reduction
    Date: 2016–04–19
  6. By: Moturi, Walter; Obare, Gideon; Kahi, Alexander
    Abstract: This paper uses data from a survey of one hundred and eighty four dairy households in two divisional administrative zones in the Kenya highlands to empirically analyze the factors that influence the choice of a milk marketing channel. Multinomial logit econometric estimation results show that distance to milk collection centre, education level, membership of the household head to farmers' group/organization, the number of cows ownedn by the household, and the coefficiency of variation in prices significantly influenced the choice of a marketing channel. Private channel players are yet to focus on tapping the production potential of farmers with small herd sizes and encouraging group formation to exploit the social capital. The study demonstrates the need for the private sector to enhance milk collection at the unexplored areas to exploit the milk supply potentials. The implications for policy are provide.
    Keywords: Agricultural and Food Policy, Food Consumption/Nutrition/Food Safety, Marketing,
    Date: 2015

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