nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2019‒09‒30
two papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. Taste Heterogeneity and Adaptive Reuse of Buildings: A Latent Class Model By Brano Glumac; Nizamul Islam
  2. Redistribution of Individual Pension Wealth to Survivor Pensions: Evidence from a Stated Preferences Analysis By de Grip, Andries; Fouarge, Didier; Montizaan, Raymond

  1. By: Brano Glumac; Nizamul Islam
    Abstract: Vacant buildings represent insufficiently exploited potential for urban development. By collecting and analysing the preferences of its future users, vacant buildings can be adapted and reused in the best manner and thus could generate a significant contribution towards a more sustainable development within the construction industry. Discrete choice experiment is used to identify the most important attributes and to collect the preferences of the potential future occupants choosing between two types of residential buildings, redeveloped factory and office. This study reports on the preferences of different groups of respondents such as students, young professionals, couples with children, etc. Therefore, exploring the taste heterogeneity (observed and unobserved) takes a central place in this study. Furthermore, these results can be used within a decision tool to better assess upon choice of vacant building to fit best to future desired end user. Adaptive building reuse provides numerous environmental, socio-economic, and urban policy benefits and we do provide fruitfully discussion based on the reported findings.
    Keywords: housing; latent class model; stated preference; sustainable transformation; The Netherlands
    JEL: R3
    Date: 2019–01–01
  2. By: de Grip, Andries (ROA, Maastricht University); Fouarge, Didier (ROA, Maastricht University); Montizaan, Raymond (ROA, Maastricht University)
    Abstract: Pension schemes in the Netherlands allow workers to redistribute their own pension wealth to increase the survivor pension of their partner. However, due to lacking communication and knowledge of survivor pensions among workers, and also due to the lack of transparent products and choice architecture, redistribution remains limited. This paper uses a stated preferences experiment that is explicitly designed for workers with a partner in the age group of 55 to 65 years to elicit their pension redistribution preferences. We find that, on average, the preferred pension wealth redistribution amounts to 50%. 35% of all individuals have such a preference. 33% of all individuals would prefer less redistribution, and 32% percent prefers to redistribute more pension income to the partner upon one's death. We further show that total family income during working life does not affect the redistribution to survivor pensions. However, the distribution of the contribution to total family income before retirement across partners, as well as the survival likelihood of the partner and the number of years the partner is expected to survive, have a significant causal impact on the preferred pension redistribution decision. The preference for redistribution to survivor pensions also depends significantly on personal characteristics, preferences and social attitude. Males have a significantly stronger preference for redistribution compared to females. Moreover, forward-looking, more risk averse and more altruistic individuals have a stronger preference to redistribute part of their pension wealth to a survivor pension. Finally, in particular when employees have the perception that their partner is more forward looking, they are willing to invest more in a survivor pension.
    Keywords: stated preferences experiment, redistribution of pension wealth, survivors pension, economic preferences
    JEL: J14 J26 D31
    Date: 2019–09

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