nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2018‒08‒20
five papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. Are preferences stated in web vs. personal interviews different? A comparison of willingness to pay results for a large multi-country study of the Baltic Sea eutrophication reduction By Zawojska, Ewa; Czajkowski, Mikotaj
  2. How where I shop influences what I buy: the importance of the retail format in sustainable tomato consumption By Baum, Chad M.; Weigelt, Robert
  3. Disentangling impacts of payment and provision consequentiality and risk attitudes on stated preferences By Zawojska, Ewa; Bartczak, Anna; Czajkowski, Mikotaj
  4. Modelling Electric Vehicles as an Abatement Technology in a Hybrid CGE Model By Stefan Schmelzer; Michael Miess; Vedunka Kopecna; Milan Scasny
  5. Measurement Error in Discrete Health Facility Choice Models:an Example from Urban Senegal By Cronin, C.J.;; Guilkey, D.K.;; Speizer, I.S.;

  1. By: Zawojska, Ewa; Czajkowski, Mikotaj
    Abstract: We investigate the prevailing view in the stated preference literature that the data collection mode does not significantly affect the value estimates. Based on data from Computer-Assisted Web Interviews and Computer-Assisted Personal Interviews aimed at assessing the social benefits for Poland from meeting the nutrient load reduction targets defined in the HELCOM’s Baltic Sea Action Plan (2007), we find that the value estimates obtained from the two modes differ significantly. This evidences the existence of a “pure” mode effect as we control for socio-demographic differences between the web-interviewed and personally-interviewed samples by weighting the observations. The relative difference in the derived values between the two modes is used to update the estimates of the economic values of reducing nutrient loadings to the Baltic Sea provided by Ahtiainen et al. (2014) for every Baltic Sea country. In addition to controlling for the mode effect (as different, web and personal, modes were used in different countries), we examine 18 alternative model specifications to find the distribution that captures best the payment-card willingness-to-pay responses. Overall, our study illustrates the extent of the impact that the choice of a data collection mode can have on valuation results.
    Keywords: Environmental Economics and Policy, Institutional and Behavioral Economics, Research Methods/ Statistical Methods
    Date: 2017–06–21
  2. By: Baum, Chad M.; Weigelt, Robert
    Abstract: Although interest in sustainable food has increased substantially in recent years, the actual demand for such products has typically proceeded quite unevenly across consumers. Making sense of the variable pace of behavioral change requires that we explore the foundations of sustainable consumer behavior, especially the importance attached to particular attributes and the types of tradeoffs that exist. For this reason, this study utilizes a discrete choice experiment (DCE) that integrates the type of retail format to establish the potential for interaction effects with attributes. Stated-preference methods like DCEs have proven useful to explain how and why individuals’ willingness to pay (WTP) for qualities such as organic, fair trade, and locality can differ. However, by mostly focusing on product qualities alone, the importance of the retail formats where products are actually purchased – and their potential impact on the valuation of attributes – is left unexplored. Framing this DCE in relation to sustainable tomato consumption, we can conclude that the type of retail format is a significant determinant of purchasing behavior, both on its own and in its interaction with the other qualities.
    Keywords: Agricultural and Food Policy, Consumer/Household Economics, Environmental Economics and Policy, Food Consumption/Nutrition/Food Safety, Marketing, Research Methods/ Statistical Methods
    Date: 2017–03–16
  3. By: Zawojska, Ewa; Bartczak, Anna; Czajkowski, Mikotaj
    Abstract: Stated preference literature suggests that to be incentivised to reveal preferences truthfully in a survey, respondents need to believe that a response in favour of a policy project of providing a public good increases chances of actual provision of the good (policy consequentiality) and that the cost of conducing the policy project stated in a survey will be actually collected upon the policy implementation (payment consequentiality). We investigate the effects of the two aspects of consequentiality beliefs on stated preferences in a field survey concerning renewable energy development in Poland. Using a hybrid choice model to capture unobservable beliefs in consequentiality, we find that latent beliefs in policy consequentiality and in payment consequentiality affect stated preferences differently: respondents believing in policy consequentiality prefer the project implementation to the status quo more than those believing in payment consequentiality; respondents believing in payment consequentiality state significantly lower willingness to pay for the project than those believing in policy consequentiality. Respondents with no clear opinion on the degree of the survey’s consequentiality reveal substantially different preferences; they are much less interested in seeing the proposed project implemented. We also find that respondents’ risk attitudes do not impinge neither on their self-reported perceptions over the survey’s consequentiality nor on their preferences.
    Keywords: Institutional and Behavioral Economics, Resource /Energy Economics and Policy, Risk and Uncertainty
    Date: 2017–06–21
  4. By: Stefan Schmelzer (Institute for Advanced Studies, Vienna; Institute for Ecological Economics, WU - Vienna University of Economics and Business); Michael Miess (Institute for Advanced Studies, Vienna; Institute for Ecological Economics, WU - Vienna University of Economics and Business; Complexity Science Hub Vienna); Vedunka Kopecna (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nabrezi 6, 111 01 Prague 1, Czech Republic); Milan Scasny (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nabrezi 6, 111 01 Prague 1, Czech Republic)
    Abstract: We present a novel methodology to quantify the social costs and benefits (net social costs) of electric vehicles as an endogenous, demand-driven abatement technology in a general equilibrium framework. This new costing approach relates general equilibrium effects resulting from an increased market penetration of electric vehicles to the external environmental and health effects of the corresponding change in emissions. To this end, we develop a hybrid model combining a computable general equilibrium (CGE) with a discrete choice (DC) model that is capable of depicting an endogenous demand-driven uptake of alternative fuel vehicles. The discrete choice model of the consumer purchase decision between conventional, hybrid, plug-in hybrid, and electric vehicles is directly integrated into the CGE model. This hybrid CGE-DC model features a detailed accounting of vehicle fleet development, including yearly numbers of vehicle purchases and cohort depreciation. It depicts nine households differentiated by the degree of urbanization and education, accounts for detailed consumer preferences for the purchase of a passenger vehicle and mode choice decisions. The hybrid CGE-DC model is additionally hard-linked to a bottom-up module for elektricity production by several technologies to provide input for an established impact pathway analysis to quantify the external costs relating to the changed composition of the vehicle fleet and technologies to generate electricity. We apply this methodology to Austria as an empirical example, considering current measures and trends for the uptake of electric vehicles into the vehicle fleet. In particular, we quantify the net social costs of additional measures to foster the introduction of electromobility that are part of the current policy discussion in Austria, and thus provide a blueprint for further application in different national contexts.
    Keywords: hybrid CGE model; discrete choice; electric vehicles; environmental benefits
    JEL: C68 D12 D58 H22 H23 Q43 Q52 R42
    Date: 2018–08
  5. By: Cronin, C.J.;; Guilkey, D.K.;; Speizer, I.S.;
    Abstract: A number of authors have utilized health facility choice models to determine how individuals in developing countries evaluate the tradeoff between the price, quality, and indirect costs of obtaining medical care. A common problem in this literature is that researchers only observe the type of facility that individuals report visiting (e.g., public or private hospital, health center or dispensary, or traditional healer) and, therefore, must assume individuals visit the nearest facility of the type they report. This matching procedure creates measurement error in the choice variable, which may introduce bias in parameter estimates. In this research, we use a data set from urban Senegal that allows for a precise individual-health facility match to estimate consumer preferences for health facility characteristics related to maternal health and family planning services. Using actual rather than imputed choices, we find that consumers prefer high quality health facilities that are nearby. Given the preference for quality, our findings indicate that in contrast to the typical assumption in the literature, individuals frequently bypass the facility nearest their home. When we estimate models using the mismeasured choice variable, the results show a significant bias in preference estimates; most notably, these models systematically overestimate distaste for travel. To highlight a potential consequence of biased preference estimates in this setting, we conclude by simulating the impact of an actual policy that took place in 2014; namely, the opening of a new facility in a previously underserved area of Dakar, Senegal.
    Keywords: measurement error; discrete choice; health facility choice; maternal health; family planning; Senegal;
    JEL: I12 I15 I18 J13 C35
    Date: 2018–08

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