nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2016‒06‒25
three papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. Consumer Demand for Rhino Horn in Vietnam: insights from a choice experiment By Nick Hanley; Oleg Sheremet; Martina Bozzola; Alexander Kasterine; Douglas C. MacMillan
  2. Eliciting Risk Preferences for Intrinsic Attributes By Dorner, Zach; Brent, Daniel A.; Leroux, Anke
  3. Identifying effects of multivalued treatments By Sokbae Lee; Bernard Salanie

  1. By: Nick Hanley (Department of Geography and Sustainable Development, University of St. Andrews); Oleg Sheremet (Department of Geography and Sustainable Development, University of St. Andrews); Martina Bozzola (International Trade Centre, Geneva); Alexander Kasterine (International Trade Centre, Geneva); Douglas C. MacMillan (DICE, School of Anthropology and Conservation, University of Kent)
    Abstract: The international demand for endangered animal and plant species as traditional medicine, luxury foods and curios is strong and rising, especially in eastern Asia. The illegal poaching of wildlife to supply this market represents an immediate and growing threat to the survival of many endangered species. To counter the illegal international wildlife trade, the global community remains committed to supply-side trade restrictions and enforcement of poaching laws. However, despite these actions recovery in the populations of many species is being threatened by rising poaching rates over the last 10 years. In this paper, we use a choice experiment undertaken with over 800 residents of Vietnam, in order to investigate how the demand for rhino horn varies according to its source attributes. The survey sample includes 130 respondents who reported having either purchased or used rhino horn medicinal products in the past 5 years and a further 345 who expressed some interest in purchasing rhino horn medicinal products in the future. In particular, we estimate willingness to pay for horn that differs according to source (farmed, semi-wild, farmed) harvesting method (lethal and non-lethal), rarity of the rhino species and price. We also compare preferences elicited in the context of illegal trade in rhino horn, compared to legalised trade, and how consumer preferences vary according to socio-economic variables such as income. We find that preferences are significantly influenced by source and harvesting method and income level, with non-lethal harvesting and wild sourced horn generally preferred especially by the richest consumers, who are also the consumers most likely to have previously bought horn products. Under a legal trade demand would fall for all horn types and consumer groups.
    Keywords: : choice experiment, willingness to pay, demand for endangered species, international trade, rhino horn products
    JEL: Q27 Q51 Q57
    Date: 2016–05
  2. By: Dorner, Zach; Brent, Daniel A.; Leroux, Anke
    Abstract: Risk is an important attribute of goods, whereby the utility derived from that attribute is determined by one's attitude to risk. We develop a novel approach to leverage data on risk attitudes from a fully incentivized risk elicitation task to model intrinsic riskiness of alternatives in a choice experiment. In a door-to-door survey, 981 respondents participated in a discrete choice experiment to elicit pref- erences over alternative sources of municipal water, conditional on water price and quality. Additional source attributes, such as supply risks due to the water source being weather dependent or technology risks are treated as intrinsic as they cannot be plausibly disassociated from the water supply source. The risk task allows the estimation of a coefficient of constant relative risk aversion (CRRA) for an indi- vidual, which is incorporated into the preference estimation to test the hypotheses that supply risk and new technology risk are important intrinsic attributes for new water sources. Participants are not given information about supply or technological risks of the sources to avoid framing effects driving the results. Controlling for water quality and cost, we find that supply risk is an important determinant of participants' choices, while respondents are not concerned about technology risk.
    Keywords: Research and Development/Tech Change/Emerging Technologies, Research Methods/ Statistical Methods, Risk and Uncertainty,
    Date: 2016–06
  3. By: Sokbae Lee (Institute for Fiscal Studies and Institute for Fiscal Studies); Bernard Salanie (Institute for Fiscal Studies and Columbia)
    Abstract: Multivalued treatment models have only been studied so far under restrictive assumptions: ordered choice, or more recently unordered monotonicity. We show how marginal treatment e?ects can be identi?ed in a more general class of models. Our results rely on two main assumptions: treatment assignment must be a measurable function of threshold-crossing rules; and enough continuous instruments must be available. On the other hand, we do not require any kind of monotonicity condition. We illustrate our approach on several commonly used models; and we also discuss the identi?cation power of discrete instruments.
    Date: 2015–12–08

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