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on Discrete Choice Models |
| By: | Jean-Michel Benkert; Shuo Liu; Nick Netzer |
| Abstract: | Response times contain information about economically relevant but unobserved variables like willingness to pay, preference intensity, quality, or happiness. Here, we provide a general characterization of the properties of latent variables that can be detected using response time data. Our characterization generalizes various results in the literature, helps to solve identification problems of binary response models, and paves the way for many new applications. We apply the result to test the hypothesis that marginal happiness is decreasing in income, a principle that is commonly accepted but so far not established empirically. |
| Keywords: | Response times, chronometric effect, binary response model, non-parametric identification, decreasing marginal happiness |
| JEL: | C14 D60 D91 I31 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:zur:econwp:449 |
| By: | Mangole, Cool Dady; Mulungu, Kelvin; Kaghoma, Christian Kamala; Tschopp, Maurice; Kassie, Menale |
| Keywords: | Demand and Price Analysis |
| Date: | 2024–08–07 |
| URL: | https://d.repec.org/n?u=RePEc:ags:cfcp15:344264 |
| By: | George Halkos; Argyro Zisiadou; Panagiotis Stavros Aslanidis; Phoebe Koundouri |
| Abstract: | The Black Sea region faces pressures on ecosystem services (ES) due to invasive species, waste, eutrophication, and biodiversity loss. We apply a stated preference technique, i.e. a choice experiment (CE), aiming to compare three hypothetical scenarios regarding the welfare impact of ES on citizens' lives in terms of willingness-to-pay (WTP). Initially, the distributed questionnaires underwent an econometric pre-test regarding the orthogonality of all CE scenarios in R-studio. Questionnaire distribution occurred from 29/05/2023 to 21/11/2023 with a total number of 375 responders from the three pilot sites: Turkey, Romania, and Georgia. The highest WTP occurred in Turkey (56.72�) for all scenarios followed by Georgia (49.04�), and Romania (47.96�). Moreover, the greater WTP value is demonstrated by Scenario C (25.51�) followed by Scenarios B (25.17�) and Scenario A (25.11�). Interesting socioeconomic characteristics derived from Cross-Tabulation Analysis that notably cannot impact the WTP are income, gender, and age. Furthermore, marital status and education might affect the WTP only in Romania, however, this is not demonstrated in Turkey or Georgia. Interestingly, the higher level of education in Romania is linked to lower WTP, nevertheless, education typically relates to environmental sensitivity. Another aspect is that occupation can change responders' WTP in Romania and Georgia, but not in Turkey. In essence, the economic valuation of ES through CE methodology can offer policymaking insights into Blue Growth initiatives. |
| Keywords: | ecosystem management, human impacts, valuation studies, choice experiment, stated preferences, blue economy, sustainable development goals |
| Date: | 2024–08–26 |
| URL: | https://d.repec.org/n?u=RePEc:aue:wpaper:2414 |
| By: | Maximilian Osterhaus |
| Abstract: | A severe limitation of many nonparametric estimators for random coefficient models is the exponential increase of the number of parameters in the number of random coefficients included into the model. This property, known as the curse of dimensionality, restricts the application of such estimators to models with moderately few random coefficients. This paper proposes a scalable nonparametric estimator for high-dimensional random coefficient models. The estimator uses a truncated tensor product of one-dimensional hierarchical basis functions to approximate the underlying random coefficients' distribution. Due to the truncation, the number of parameters increases at a much slower rate than in the regular tensor product basis, rendering the nonparametric estimation of high-dimensional random coefficient models feasible. The derived estimator allows estimating the underlying distribution with constrained least squares, making the approach computationally simple and fast. Monte Carlo experiments and an application to data on the regulation of air pollution illustrate the good performance of the estimator. |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2408.07185 |
| By: | Dianna R. Amasino (Tilburg University and University of Amsterdam); Suzanne Oosterwijk (University of Amsterdam); Nicolette J. Sullivan (The London School of Economics and Political Science); Joël van der Weele (University of Amsterdam) |
| Abstract: | Consumers often encounter, and claim to care about, ethical information concerning the products they purchase. Across three studies, we investigate how the accessibility of this information impacts choice. When consumers must seek out product attribute information, the impact of ethical certifications (Fairtrade and Organic) is diminished relative to other attributes. Both positive and negative framing of certifications increase their impact on choice relative to neutral frames, with negative frames having the strongest effect. However, in contrast to theories of information demand that would predict more willful ignorance of negatively framed content, negative framing has the same impact regardless of information accessibility. Together, our findings suggest that having to seek ethical certification information leads to a small reduction in the use of certifications to guide choice, but that affective framing has a larger impact on the weight placed on certifications in consumer choices regardless of the accessibility of information. |
| Keywords: | Consumer-choice, information-avoidance, information-seeking, willful ignorance, sustainability, certifications |
| JEL: | D12 D83 D87 |
| Date: | 2024–05–10 |
| URL: | https://d.repec.org/n?u=RePEc:tin:wpaper:20240029 |
| By: | George Halkos; Panagiotis Stavros Aslanidis; Angelos Plataniotis; Phoebe Koundouri |
| Abstract: | Sustainable development ensures the longevity of civilization by balancing economic growth, environmental protection, and social equity. The present study evaluates cultural heritage assets via a meta-regression analysis function transfer, in which 85 studies were examined that revealed 106 different willingness-to-pay (WTP) values in the period 1995 - 2022. The meta-regression methodology enables the valuation of cultural heritage - tangible and intangible - goods and services, as well as cultural values (e.g. aesthetic, spiritual, symbolic, etc.). The utilization of WTP would enable us to compare the two models (i.e., European and non-European) on how much a citizen would value cultural heritage based on non-market valuation. The results would inform policymakers about the importance of cultural heritage assets in the sustainable development agenda. The empirical findings present that the WTP for the European sample is 37.6� and for the non-European is 60.12�. In essence, the Europeans are influenced mainly by intangible cultural assets, whereas non-Europeans are influenced by oral tradition. Overall, cultural heritage conservation necessitates for proper economic valuation through a holistic approach, in short - the valuation of both tangible and intangible cultural goods and services is imperative for sustainable development. |
| Keywords: | Willingness to pay, Tangible cultural heritage, Intangible cultural heritage, Meta-regression analysis, Benefit transfer, Value transfer |
| JEL: | Z1 Z18 C5 Q53 Q5 |
| Date: | 2024–08–26 |
| URL: | https://d.repec.org/n?u=RePEc:aue:wpaper:2413 |
| By: | Peter Caradonna; Christopher P. Chambers |
| Abstract: | We consider the problem of rationalizing choice data by a preference satisfying an arbitrary collection of invariance axioms. Examples of such axioms include quasilinearity, homotheticity, independence-type axioms for mixture spaces, constant relative/absolute risk and ambiguity aversion axioms, stationarity for dated rewards or consumption streams, separability, and many others. We provide necessary and sufficient conditions for invariant rationalizability via a novel approach which relies on tools from the theoretical computer science literature on automated theorem proving. We also establish a generalization of the Dushnik-Miller theorem, which we use to give a complete description of the out-of-sample predictions generated by the data under any such collection of axioms. |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2408.04573 |
| By: | Erik Brynjolfsson; Avinash Collis; Asad Liaqat; Daley Kutzman; Haritz Garro; Daniel Deisenroth; Nils Wernerfelt |
| Abstract: | Research on the causal effects of online advertising on consumer welfare is limited due to challenges in running large-scale field experiments and tracking effects over extended periods. We analyze a long-running field experiment of online advertising in which a random 0.5% subset of all users are assigned to a group that does not ever see ever ads. We recruit a representative sample of Facebook users in the ads and no-ads groups and estimate their welfare gains from using Facebook using a series of incentive-compatible choice experiments. We find no significant differences in welfare gains from Facebook. Our estimates are relatively precisely estimated reflecting our large sample size (53, 166 participants). Specifically, the minimum detectable difference in median valuations at standard thresholds is $3.18/month compared to a baseline valuation of $31.95/month for giving up access to Facebook. That is, we can reject the hypothesis that the median disutility from advertising exceeds 10% of the median baseline valuation. Our findings suggest that either the disutility of ads for consumers is relatively small, or that there are offsetting benefits, such as helping consumers find products and services of interest. |
| JEL: | D12 D6 K24 M15 M37 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32846 |
| By: | Peter P. Caradonna; Christopher Turansick |
| Abstract: | We characterize those ex-ante restrictions on the random utility model which lead to identification. We first identify a simple class of perturbations which transfer mass from a suitable pair of preferences to the pair formed by swapping certain compatible lower contour sets. We show that two distributions over preferences are behaviorally equivalent if and only if they can be obtained from each other by a finite sequence of such transformations. Using this, we obtain specialized characterizations of which restrictions on the support of a random utility model yield identification, as well as of the extreme points of the set of distributions rationalizing a given data set. Finally, when a model depends smoothly on some set of parameters, we show that under mild topological assumptions, identification is characterized by a straightforward, local test. |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2408.06547 |