nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2020‒02‒03
seven papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. Revealed Preference Analysis of School Choice Models By Nikhil Agarwal; Paulo J. Somaini
  2. Vote Choice Formation and Minimal Effects of TV Debates: Evidence from 61 Elections in 9 OECD Countries By Caroline Le Pennec; Vincent Pons
  3. Individual Behavior in Complex Choice Situations By Klein, Tobias
  4. Efficient and Convergent Sequential Pseudo-Likelihood Estimation of Dynamic Discrete Games By Adam Dearing; Jason R. Blevins
  5. Reducing the income tax burden for households with children: An assessment of the child tax credit reform in Austria By Michael Christl; Silvia De Poli; Janos Vargas
  6. Using experimental manipulation of questionnaire design and a Kenyan panel to test for the reliability of reported perceptions of climate change and adaptation By Alistair Munro
  7. Restricted Probabilistic Fixed Ballot Rules and Hybrid Domains By Chatterji, Shurojit; Roy, Souvik; Sadhukhan, Soumyarup; Sen, Arunava; Zeng, Huaxia

  1. By: Nikhil Agarwal; Paulo J. Somaini
    Abstract: Preferences for schools are important determinants of equitable access to high-quality education, effects of expanded choice on school improvement and school choice mechanism design. Standard methods for estimating consumer preferences are not applicable in education markets because students do not always get their first choice school. This review describes recently developed methods for using rich data from a school choice mechanism to estimate student preferences. Our objectives are to present a unifying framework for these methods and to help applied researchers decide which techniques to use. After laying out methodological issues, we provide an overview of empirical results obtained using these models and discuss some open questions.
    JEL: D47 I21
    Date: 2019–12
  2. By: Caroline Le Pennec; Vincent Pons
    Abstract: We use 201,000 observations from repeated survey data in 61 elections and 9 OECD countries since 1952 to study the formation of vote choices and policy preferences in the electoral season and assess how TV debates contribute to this process. We find that the share of voters who state a pre-election vote intention corresponding to their final vote choice increases by 15 percentage points in the two months preceding the election. Changes in individual vote choices mostly result from changes in beliefs on competing candidates and in issue salience, and they generate aggregate shifts in predicted vote shares. Instead, policy preferences remain remarkably stable over time. We use an event study to estimate the impact of TV debates, and find that they affect significantly neither individual vote choice and preference formation nor aggregate vote shares. This suggests that information continuously received by voters exerts more influence on their behavior.
    JEL: D72 D83
    Date: 2019–12
  3. By: Klein, Tobias (Tilburg University, School of Economics and Management)
    Date: 2019
  4. By: Adam Dearing; Jason R. Blevins
    Abstract: We propose a new sequential Efficient Pseudo-Likelihood (EPL) estimator for structural economic models with an equality constraint, particularly dynamic discrete choice games of incomplete information. Each iteration in the EPL sequence is consistent and asymptotically efficient, and iterating to convergence improves finite sample performance. For dynamic single-agent models, we show that Aguirregabiria and Mira's (2002, 2007) Nested Pseudo-Likelihood (NPL) estimator arises as a special case of EPL. In dynamic games, EPL maintains its efficiency properties, although NPL does not. And a convenient change of variable in the equilibrium fixed point equation ensures EPL iterations have the same computational simplicity as NPL iterations. Furthermore, EPL iterations are stable and locally convergent to the finite-sample maximum likelihood estimator at a nearly-quadratic rate for all regular Markov perfect equilibria, including unstable equilibria where NPL encounters convergence problems. Monte Carlo simulations confirm the theoretical results and demonstrate EPL's good performance in finite samples.
    Date: 2019–12
  5. By: Michael Christl (European Commission - JRC); Silvia De Poli (European Commission - JRC); Janos Vargas (European Commission – DG ECFIN)
    Abstract: This paper analyses the impact of the implementation of a child tax credit in Austria in 2019, not only on micro, but also on macro level by using a dynamic scoring methodology. First, we assess the fiscal and distributional impact of this reform using the microsimulation model EUROMOD. Second, we estimate labour supply impacts of the reform based on a structural discrete choice framework. Third, we evaluate the macroeconomic impacts of the reform, by calibrating and shocking QUEST, the DSGE model of the European Commission, with the micro-based results for the implicit tax rate, the non-participation and the labour supply elasticities. We show that the child tax credit reform in Austria reduces inequality, lowers the poverty rate in general, but by definition only for households with children. Overall the reform has a positive impact on labour supply, both on the extensive and on the intensive margin, especially for women. On the macro-level (and in the long-run), our model suggests a positive impact on employment. Additionally, we find that parts of the tax decrease can be potentially captured by the employer, meaning that gross wages would fall slightly. However, we find small but positive effects on GDP, investment and consumption, although the long-run macroeconomic effects depend crucially on how the government compensates the missing tax revenues after the reform. Accounting for these effects at the micro level, we show that the second round effects are important to take into account, because they provide insights into the medium-term distributional impact of the reform.
    Keywords: EUROMOD, tax credit, reform, DSGE, labour supply, microsimulation, discrete choice
    JEL: H24 H31 I38
    Date: 2019–12
  6. By: Alistair Munro (National Graduate Institute for Policy Studies, Tokyo, Japan)
    Abstract: While the use of surveys to understand perception of climate change and adaptation is common in research on agriculture, the reliability of aspects of the methodology is still largely untested. In particular there is limited evidence on (i) the degree to which measures of perception are sensitive to questionnaire design (ii) the accuracy of recall methods for climate change and (iii) the degree to which measures of adaptation based on recall from one-time surveys match the historical record. Using an established panel of farmers from across Kenya and a split sample method, I test both the sensitivity of stated perceptions of climate change to question format and the accuracy of recalled adaptations. In one treatment farmers face open-ended questions about temperature and rainfall changes while in the other treatment farmers are o ered closed-end questions. Both approaches are common in the voluminous literature on climate change adaptation. Responses are highly sensitive to question format, both in the degree of perceived change and in the types of changes. Stated adaptations are not so sensitive to question format, but still diverge. Stated adaptations do not correspond well to the historical record of farming practices over the 15 years of the panel. Overall, the evidence suggests that researchers and policy-makers should be highly cautious in their use of subjective perceptions of climate change and the use of adaptation measures based on recall data.
    Date: 2020–01
  7. By: Chatterji, Shurojit (School of Economics, Singapore Management University); Roy, Souvik (Indian Statistical Institute); Sadhukhan, Soumyarup (Indian Statistical Institute); Sen, Arunava (Indian Statistical Institute); Zeng, Huaxia (Shanghai University of Finance and Economics)
    Abstract: We study Random Social Choice Functions (or RSCFs) in a standard ordinal mech-anism design model. We introduce a new preference domain called a hybrid domain which includes as special cases as the complete domain and the single-peaked domain. We characterize the class of unanimous and strategy-proof RSCFs on these domains and refer to them as Restricted Probabilistic Fixed Ballot Rules (or RPFBRs). These RSCFs are not necessarily decomposable, i.e., cannot be written as a convex combina-tion of their deterministic counterparts. We identify a necessary and sufficient condition under which decomposability holds for anonymous RPFBRs. Finally, we provide an axiomatic justification of hybrid domains and show that every connected domain satis-fying some mild conditions is a hybrid domain where the RPFBR characterization still prevails.
    Keywords: Strategy-proofness; hybrid domain; restricted probabilistic fixed ballot rule; decomposability; connectedness
    JEL: D71 H41
    Date: 2020–01–09

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