nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2021‒03‒01
seven papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. To Pool or Not to Pool? Understanding the Time and Price Tradeoffs of OnDemand Ride Users – Opportunities, Challenges, and Social Equity Considerations for Policies to Promote Shared-Ride Services By Shaheen, Susan PhD; Lazarus, Jessica; Caicedo, Juan; Bayen, Alexandre PhD
  2. Preferences for Blue-Green or Grey Infrastructure to Reduce Flood Risk: A Choice Experiment By Deely, John; Hynes, Stephen
  3. Eliciting and utilizing willingness to pay: evidence from field trials in northern Ghana By Berry, James; Fischer, Gregory; Guiteras, Raymond
  4. Entropy balancing for causal effects in discrete choice analysis: The Blue Planet II effect. By Hynes, S.; Ankamah-Yeboah, I.; O’Neill, S.; Needham, K.; Bich Xuan, B.; Armstrong, C.
  5. Measuring consumer well-being from using zero price digital services: The case of navigation apps and location-based services By Maciej Sobolewski
  6. Generic Inference on Quantile and Quantile Effect Functions for Discrete Outcomes By Chernozhukov, Victor; Fernandez-Val, Ivan; Melly, Blaise; Wuthrich, Kaspar
  7. Institutional conditions for the up-take of governance experiments - A comparative case study By Feser, Daniel; Winkler-Portmann, Simon; Bischoff, Thore Sören; Bauknecht, Dierk; Bizer, Kilian; Führ, Martin; Heyen, Dirk Arne; Proeger, Till; von der Leyen, Kaja; Vogel, Moritz

  1. By: Shaheen, Susan PhD; Lazarus, Jessica; Caicedo, Juan; Bayen, Alexandre PhD
    Abstract: On-demand mobility services including transportation network companies (also known as ridesourcing and ridehailing) like Lyft and Uber are changing the way that people travel by providing dynamic mobility that can supplement public transit and personal-vehicle use. However, TNC services have been found to contribute to increasing vehicle mileage, traffic congestion, and greenhouse gas emissions. Pooling rides ⎯ sharing a vehicle by multiple passengers to complete journeys of similar origin and destination ⎯ can increase the average vehicle occupancy of TNC trips and thus mitigate some of the negative impacts. Several mobility companies have launched app-based pooling services in recent years including app-based carpooling services (e.g., Waze Carpool, Scoop) that match drivers with riders; pooled on-demand ride services (e.g., Uber Pool and Lyft Shared rides) that match multiple TNC users; and microtransit services (e.g., Bridj, Chariot, Via) that offer on-demand, flexibly routed service, typically in larger vehicles such as vans or shuttles. However, information on the potential impacts of these options is so far limited. This research employs a general population stated preference survey of four California metropolitan regions (Los Angeles, Sacramento, San Diego, and the San Francisco Bay Area) in Fall 2018 to examine the opportunities and challenges for drastically expanding the market for pooling, accounting for differences in emergent travel behavior and preferences across the four metropolitan regions surveyed. The travel profiles, TNC use patterns, and attitudes and perceptions of TNCs and pooling are analyzed across key socio-demographic attributes to enrich behavioral understanding of marginalized and price sensitive users of on-demand ride services. This research further develops a discrete choice model to identify significant factors influencing a TNC user’s choice to pool or not to pool, as well as estimating a traveler’s value of time (VOT) across different portions of a TNC trip. This research provides key insights and social equity considerations for policies that could be employed to reduce vehicle miles traveled and emissions from passenger road transportation by incentivizing the use of pooled on-demand ride services and public transit
    Keywords: Engineering, Demand responsive transportation, ridesourcing, shared mobility, stated preference, surveys, travel behavior, choice models
    Date: 2021–02–01
  2. By: Deely, John; Hynes, Stephen
    Abstract: Flood reduction infrastructure is a vital aspect of many urban and peri-urban areas. To date, the majority of flood reduction projects use traditional “grey” materials and techniques. However, the use of blue-green infrastructures (BGI) is becoming more popular. This paper explores residents’ preferences for BGI or grey infrastructure projects to reduce flood risk. A discrete choice experiment using a split sample methodology was employed to determine if residents of the Carlingford Lough catchment in Ireland prefer either type of infrastructure to reduce flood risk. A random parameter logit was applied to the data. The results reveal that for the average person, they have a preference for flood risk reduction resulting in a flooding event once every 25 years rather than once every five years. The average respondent also holds a preference for BGI based solutions as opposed to a grey infrastructure solution. However, respondent living in a flood-prone area show no greater preference for a BGI solution.
    Keywords: Environmental Economics and Policy
    Date: 2020
  3. By: Berry, James; Fischer, Gregory; Guiteras, Raymond
    Abstract: We use the Becker-DeGroot-Marschak (BDM) mechanism to estimate willingness to pay (WTP) for and heterogeneous impacts of clean water technology through a field experiment in Ghana. Although WTP is low relative to cost, demand is inelastic at low prices. Short-run treatment effects are positive throughout the WTP distribution. After 1 year, use and benefits are both increasing in WTP, with negative effects on low-WTP households. Combining estimated treatment effects with house-holds’ WTP implies valuations of health benefits much smaller than typically used by policy makers. We explore differences between BDM and take-it-or-leave-it valuations and make recommendations for implementing BDM in the field.
    Keywords: price mechanism; heterogeneous treatment effects; health behavior; Becker- DeGroot-Marschak; field experiments
    JEL: C93 D12 L11 L31 O12 Q51
    Date: 2020–04–01
  4. By: Hynes, S.; Ankamah-Yeboah, I.; O’Neill, S.; Needham, K.; Bich Xuan, B.; Armstrong, C.
    Abstract: In this study the discrete choice experiment approach was employed in a survey of the Scottish general public to analyse how respondents make trade-offs between blue growth potential and marine ecosystem service delivery associated with the Mingulay cold water reef complex. Results indicate a higher willingness to pay for management options associated with the highest possible levels of marine litter control followed by the highest possible levels of fish health. Using entropy balancing, a multivariate reweighting method to produce balanced samples in observational studies, we also test the impact that having watched the BBC Blue Planet II documentary series may have had on individuals’ willingness to support marine conservation activity. Whether or not respondents had seen the BBC Blue Planet II series was found to have a significant impact on people’s preferences. Despite this, the willingness to pay (WTP) does not differ between the two groups suggesting that such documentaries may impact preferences but not the final action of WTP. It is argued that the entropy weighting approach can be a useful tool in discrete choice modelling when the researcher is concerned with estimating differences in preferences between a group of interest and a comparison group.
    Keywords: Environmental Economics and Policy, Institutional and Behavioral Economics
    Date: 2020
  5. By: Maciej Sobolewski (European Commission – JRC)
    Abstract: Digital maps and navigation applications are considered an essential tool by 70% of smartphone users. As these apps come predominantly free of charge, their contribution to consumer well-being cannot be captured by the common economic measures, like the GDP. This study demonstrates how the discrete choice experiment approach can be applied to measure, in an economically consistent way, consumer surplus from a navigation service. We elicit preferences for a satellite navigation with the two optional location-based functionalities: real-time traffic information and location-sensitive commercial information. In the experiment, the respondents are confronted with a range of location-sharing conditions set by a navigation provider. Finally, we estimate a demand model and derive welfare measures from the collected choices. Median consumer surplus from using basic satellite navigation without location-based functionalities is estimated at 8.06 EUR per month. Adding location-based services can increase this gain by 36% to 10.98 EUR, provided that users maintain control over location disclosure. Location-sharing terms set by a provider and privacy concerns of users both affect the size of the surplus from a navigation service.
    Keywords: zero price digital goods, navigation, digital maps, choice experiment, consumer surplus, location
    JEL: C25 D12 L51
    Date: 2021–02
  6. By: Chernozhukov, Victor; Fernandez-Val, Ivan; Melly, Blaise; Wuthrich, Kaspar
    Keywords: Counterfactual distribution, Decomposition analysis, Distribution regression, Quantile treatment effect, Uniform inference, Statistics, Econometrics, Demography, Statistics & Probability
    Date: 2020–01–02
  7. By: Feser, Daniel; Winkler-Portmann, Simon; Bischoff, Thore Sören; Bauknecht, Dierk; Bizer, Kilian; Führ, Martin; Heyen, Dirk Arne; Proeger, Till; von der Leyen, Kaja; Vogel, Moritz
    Abstract: Experiments are an important governance instrument to support niche development, promote niche-regime interaction, challenge existing regimes and manage transition pathways for sustainable development. However, policy and regulatory learning of experiments are under-explored in the transition experimentation literature. Thus, this paper examines the following research question: How is the up-take of regulatory experiments for sustainability transitions influenced by their design elements and what role do institutional dynamics play in their up-take? The paper uses comparative qualitative content analysis to examine 27 international cases of regulatory experiments. We analyze the up-take of experiment results towards the three dimensions of scalability, transferability and unintended consequences. The analysis demonstrates that the timeframe, timing, political support, regulatory context, geographical particularities, selection processes, evaluation procedures, test of different design options, heterogeneity of participants and communication processes are important influencing factors for the up-take of experiment results.
    Keywords: Governance Experiments,Up-take,Scalability,Transferability,Unintended Consequences,Institutional Conditions
    JEL: L51 O31 Q56 Q58
    Date: 2021

This nep-dcm issue is ©2021 by Edoardo Marcucci. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.