nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2016‒10‒02
four papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. Lost Recreational Value from the Deepwater Horizon Oil Spill Using Revealed and Stated Preference Data By John C. Whitehead; Tim Haab; James Sherry Larkin; John Loomis; Sergio Alvarez; Andrew Ropicki
  2. Convergent validity of stated preference methods to estimate willingness-to-pay for seafood traceability: The case of Gulf of Mexico oysters By John C. Whitehead; O. Ashton Morgan; William L. Huth
  3. Determinants of firm location choice in metropolitan cities in India: A binary Logit model analysis By Tripathi, Sabyasachi; Kumar, Shamika
  4. Measuring the End of Life Premium in Cancer using Individual ex ante Willingness to Pay By Olofsson , Sara; Gerdtham, Ulf-G.; Hultkrantz, Lars; Persson, Ulf

  1. By: John C. Whitehead; Tim Haab; James Sherry Larkin; John Loomis; Sergio Alvarez; Andrew Ropicki
    Abstract: The lost recreational use values from the BP/Deepwater Horizon oil spill in the Gulf of Mexico were estimated from cancelled recreational trips to Northwest Florida. The impacts were calculated using the travel cost method for a single site with primary data collected from an online survey conducted after the spill. The data were collected in August and September 2011 with respondents residing in U.S. states that constitute the primary market for coastal tourism to Northwest Florida. The survey gathered information from respondents on their recreational visits to Northwest Florida, including detailed information on their past trips and the number of trips cancelled to the study region due to the oil spill. The empirical analysis involves the estimation of random parameters negative binomial count data demand functions. Using these models we find significant preference heterogeneity surrounding the effects of the oil spill. Aggregate damages are estimated to be $207 million. Key Words: BP/Deepwater Horizon oil spill,travel cost method,cancelled trips
    Date: 2016
  2. By: John C. Whitehead; O. Ashton Morgan; William L. Huth
    Abstract: In this study we compare willingness to pay for a seafood traceability system form contingent behavior demand and contingent valuation referendum vote models using data from a survey of Gulf of Mexico oyster consumers following the BP oil spill in 2010. We estimate a fixed effects model of oyster demand using contingent behavior data and find that a traceability program increases demand and consumer surplus. We estimate a referendum model for the seafood traceability program using contingent valuation data. We find that welfare estimates from the contingent behavior and contingent valuation methods are convergent valid under certain conditions. Key Words:
    Date: 2016
  3. By: Tripathi, Sabyasachi; Kumar, Shamika
    Abstract: The present paper tries to investigate the economic determinants of firm location choice in the metropolitan/large cities in India by considering firm those are using FDI (i.e., more than 10 percent of foreign investment) in 2012-13. For the analysis binary Logit model is used in this paper by taking firm level data from Capital Line database, Prowess database provided by CMIE (Centre for Monitoring Indian Economy) and Ace Equity plus database. The empirical estimations shows that total value of output, capital, and exports have a negative effect on firm location choice in the large cities. On the other hand, total value of working capital, operating profits, age of the firm, fixed assets, material cost, and sales of a firm have a positive effect on firm location choice in the large cities in India. However, the effect of percentage of FDI and total value of imports is found to be statistically insignificant on the firm‘s location choice. Finally, the paper discusses several policies in terms of location choice of firms in the large cities such as higher level of infrastructure investment, etc. for higher and sustainable industry lead urban development in India.
    Keywords: Location choice, firm location, Metropolitan cities, India
    JEL: R12 R3 R58
    Date: 2016–09–24
  4. By: Olofsson , Sara (The Swedish Institute for Health Economics (IHE)); Gerdtham, Ulf-G. (Department of Economics, Lund University); Hultkrantz, Lars (Örebro University, School of Business); Persson, Ulf (The Swedish Institute for Health Economics (IHE))
    Abstract: For the assessment of value of new therapies in healthcare, Health Technology Assessment (HTA) agencies often review the cost per Quality-Adjusted Life-Years (QALY) gained. Some HTAs accept a higher cost per QALY gained when treatment is aimed at prolonging survival for patients with a short expected remaining lifetime, a so called End-Of-Life (EoL) premium. The objective of this study is to elicit the existence and size of an EoL premium in cancer. Data was collected from 509 individuals in the Swedish general population 20-80 years old using a web-based questionnaire. Preferences were elicited using subjective risk estimation and the contingent valuation (CV) method. A split-sample design was applied to test for order bias. The value of a QALY at EoL in cancer was between €275,000 and €440,000, which is higher than the thresholds applied by HTAs. When expected remaining life expectancy was 6 months, the value of a QALY was 10-20 % higher compared to when remaining life expectancy was 24 months. Order of scenarios did not have a significant impact on the result and the result showed scale sensitivity. Thus this study supports an EoL premium in cancer when expected remaining lifetime is short.
    Keywords: willingness to pay; value of a QALY; cancer; contingent valuation; order bias
    JEL: D61 D80 I18 J17
    Date: 2016–09–23

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