nep-dcm New Economics Papers
on Discrete Choice Models
Issue of 2021‒08‒09
five papers chosen by
Edoardo Marcucci
Università degli studi Roma Tre

  1. Reconciling revealed and stated measures for willingness to pay in recreation by building a probability model By Edoh Y. Amiran; Joni S. James Charles
  2. Impact of LPG promotion program in Ghana: The role of distance to refill By Kwame Adjei-Mantey; Kenji Takeuchi; Peter Quartey
  3. Willingness to Buy and/or Pay Disparity: Evidence from Fully Autonomous Vehicles By Yoo, Sunbin; Kumagai, Junya; Kawabata, Yuta; Keeley, Alexander; Managi, Shunsuke
  4. Mind the Income Gap: Behavior of Inequality Estimators from Complex Survey Small Samples By Silvia De Nicol\`o; Maria Rosaria Ferrante; Silvia Pacei

  1. By: Edoh Y. Amiran; Joni S. James Charles
    Abstract: The consumers' willingness to pay plays an important role in economic theory and in setting policy. For a market, this function can often be estimated from observed behavior -- preferences are revealed. However, economists would like to measure consumers' willingness to pay for some goods where this can only be measured through stated valuation. Confirmed convergence of valuations based on stated preferences as compared to valuations based on revealed preferences is rare, and it is important to establish circumstances under which one can expect such convergence. By building a simple probabilistic model for the consumers' likelihood of travel, we provide an approach that should make comparing stated and revealed preferences easier in cases where the preference is tied to travel or some other behavior whose cost can be measured. We implemented this approach in a pilot study and found an estimate of willingness to pay for visiting an environmentally enhanced recreational site based on actual travel in good agreement with an estimate based on a survey using stated preferences. To use the probabilistic model we used population statistics to adjust for the relevant duration and thus compare stated and revealed responses.
    Date: 2021–07
  2. By: Kwame Adjei-Mantey (Graduate School of Economics, Kobe University); Kenji Takeuchi (Graduate School of Economics, Kobe University); Peter Quartey (Institute of Statistical, Social & Economic Research (ISSER), University of Ghana)
    Abstract: This study investigates the impact of a clean cooking intervention on primary fuel choice and on households' willingness to pay for an improved LPG distribution model in Ghana. Using data obtained via a survey of 904 households in two beneficiary districts, we found that the intervention led to higher LPG usage. The program increases the probability of households choosing LPG as a primary cooking fuel by 24% and the rate of use of LPG among households by 33%. Furthermore, an analysis of willingness to pay shows that delivery preference is not statistically different between beneficiary and control groups. The distance to refill the cylinder significantly affects LPG usage and willingness to pay. A policy that brings LPG refill closer to households and reduces the time and money cost of accessing a refill station is key to increasing the adoption of LPG as the primary cooking fuel.
    Date: 2021–08
  3. By: Yoo, Sunbin; Kumagai, Junya; Kawabata, Yuta; Keeley, Alexander; Managi, Shunsuke
    Abstract: We seek to understand whether environmental concerns, fears of potential accidents, and merits regarding fully autonomous vehicles (FAVs) are motivators of willingness to buy (WTB) and willingness to pay (WTP) of FAVs. To do so, a large-scale survey on FAVs of more than 180,000 respondents was collected in Japan, and structural equation modeling (SEM) validated our findings. Interestingly, this study implicates a form of WTB-WTP disparity: those interested in natural environment conservation would purchase FAVs because they show high interest in overall social problems, and new technologies such as FAVs can resolve such problems, according to previous works. However, our result implies that they would not show high WTP because adopting FAVs does not `directly' contribute to natural environment conservation. Additionally, our results indicate that those who appreciate potential merits would have higher WTB and WTP, while those who fear FAV technology would not purchase FAVs and would have lower WTP. The results bear crucial policy implications for planners by showing the complexity between the factors of FAV WTB and WTP.
    Keywords: Fully autonomous vehicle; WTP; structural equation model; environmental concerns.
    JEL: R4 R40 R41
    Date: 2021–06
  4. By: Silvia De Nicol\`o; Maria Rosaria Ferrante; Silvia Pacei
    Abstract: Income inequality measures are biased in small samples leading generally to an underestimation. After investigating the nature of the bias, we propose a bias-correction framework for a large class of inequality measures comprising Gini Index, Generalized Entropy and Atkinson families by accounting for complex survey designs. The proposed methodology is based on Taylor's expansions and Generalized Linearization Method, and does not require any parametric assumption on income distribution, being very flexible. Design-based performance evaluation of the suggested correction has been carried out using data taken from EU-SILC survey. Results show a noticeable bias reduction for all measures. A bootstrap variance estimation proposal and a distributional analysis follow in order to provide a comprehensive overview of the behavior of inequality estimators in small samples. Results about estimators distributions show increasing positive skewness and leptokurtosis at decreasing sample sizes, confirming the non-applicability of classical asymptotic results in small samples and suggesting the development of alternative methods of inference.
    Date: 2021–07
  5. By: Rakesh Shrivastava
    Abstract: Consumers routinely use ‘free’ services on the web by accessing these from laptops and mobile. These services are actually paid by the user’s time, attention, and data. Consumers depend on regulators and authorities to protect their interests. The arter trade of service can move to a system of money, say ‘Cyberdollar’. Whenever a service is used, the consumer of service shall pay Cyberdollars for the services used. Service-provider shall pay Cyberdollars to the consumer for their time spent, attention and for data. A Cyberdollar-based marketplace for web services shall be more efficient and vibrant than the present barter system. Consumers shall be able to influence the price of various services based on utility and quality, and service providers shall be able to optimize their earnings by dynamic pricing of services offered. Consumers shall have a choice of gracefully opting out of services, and service providers may seek compensation for loss of business. Cyberdollars may emerge as the most powerful currency used all over the globe for transacting on the world wide web. Key Words: Access to world wide web, Free web services, Prices of web-based services, Virtual currency
    Date: 2021–06

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