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on Discrete Choice Models |
| By: | Timko, Christina; Adena, Maja |
| Abstract: | Behavioral design in smartphone apps aims at inducing certain, monetizable behavior, mainly increased engagement, measurable by usage time. Such design is rarely transparent and often restricts users' ability to make alternative choices. In a framed field experiment, we document that behavioral design doubles app usage time compared to a version without behavioral elements. Providing users with choices-simply explained and conveniently adjustable design features-reduces usage time and increases their willingness to pay for the app. These findings suggest that offering choice could pave the way for new business models based on more responsible app design. |
| Keywords: | smartphone app, behavioral control, filtering algorithm, transparency and choice, self-determination, corporate social responsibility, field experiment |
| JEL: | C93 O33 D83 L86 M14 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:wzbiii:336445 |
| By: | Asena Caner (TOBB University of Economics and Technology (TOBB ETÜ)); Belgi Turan (TOBB University of Economics and Technology (TOBB ETÜ)); Berna Tari Kasnakoglu (TOBB University of Economics and Technology (TOBB ETÜ)); Yenal Can Yigit (TOBB University of Economics and Technology (TOBB ETÜ)); Donald S. Kenkel (TOBB University of Economics and Technology (TOBB ETÜ)); Donald S. Kenkel (TOBB University of Economics and Technology (TOBB ETÜ)); Alan D. Mathios (TOBB University of Economics and Technology (TOBB ETÜ)) |
| Abstract: | This study examines consumer preferences for manufactured cigarettes, roll-your-own cigarettes, and e-cigarettes in Türkiye, focusing on the impact of product attributes—such as price, legal status of e-cigarettes, and flavor availability—on consumer choices. Using a discrete choice experiment (DCE) embedded in an online survey, the research analyzes how these attributes influence decisions among Turkish adults, with a particular emphasis on the implications of regulations like e-cigarette bans. The findings reveal significant price sensitivity, both regarding the own price of products and the prices of substitute products. Additionally, the results suggest that regulatory measures, especially those targeting legal status, play a crucial role in shaping public health outcomes and consumer behavior. |
| Date: | 2025–08–20 |
| URL: | https://d.repec.org/n?u=RePEc:erg:wpaper:1791 |
| By: | Victor Aguirregabiria; Hui Liu; Yao Luo |
| Abstract: | We propose a fast algorithm for computing the GMM estimator in the BLP demand model (Berry, Levinsohn, and Pakes, 1995). Inspired by nested pseudo-likelihood methods for dynamic discrete choice models, our approach avoids repeatedly solving the inverse demand system by swapping the order of the GMM optimization and the fixed-point computation. We show that, by fixing consumer-level outside-option probabilities, BLP's market-share to mean-utility inversion becomes closed-form and, crucially, separable across products, yielding a nested pseudo-GMM algorithm with analytic gradients. The resulting estimator scales dramatically better with the number of products and is naturally suited for parallel and multithreaded implementation. In the inner loop, outside-option probabilities are treated as fixed objects while a pseudo-GMM criterion is minimized with respect to the structural parameters, substantially reducing computational cost. Monte Carlo simulations and an empirical application show that our method is significantly faster than the fastest existing alternatives, with efficiency gains that grow more than proportionally in the number of products. We provide MATLAB and Julia code to facilitate implementation. |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2602.05137 |
| By: | Christopher Kops; Paola Manzini; Marco Mariotti; Illia Pasichnichenko |
| Abstract: | We study identification in models of aggregate choice generated by unobserved behavioral types. An analyst observes only aggregate choice behavior, while the population distribution of types and their type-level choice patterns are latent. Assuming only minimal and purely qualitative prior knowledge of the process generating type-level choice probabilities, we characterize necessary and sufficient conditions for identifiability. Identification obtains if and only if the data exhibit sufficient cross-type behavioral heterogeneity, which we characterize equivalently through combinatorial matching conditions between types and alternatives, and through algebraic properties of the matrices mapping type-level to aggregate choice behavior. |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2602.10756 |
| By: | Fry, Tim R. L.; Harris, Mark N. |
| Abstract: | A plethora of tests for the Independence of Irrelevant Alternatives (IA) property of Logit models of discrete choice behavior has been proposed in the literature. These tests are based upon asymptotic arguments and little is known about their size and power properties in finite samples. This paper uses a Monte Carlo simulation study to investigate the size and power properties of six tests for IIA in the multinomial Logit (MNL) model. Our results show that tests based upon partitioning the choice set appear to have very poor size and power properties in small samples. |
| Keywords: | Research Methods/Statistical Methods |
| URL: | https://d.repec.org/n?u=RePEc:ags:monebs:267413 |
| By: | Hernán Bejarano (CIDE-ESI-Chapman University); Matías Busso (IDB); Juan Francisco Santos (IDB) |
| Abstract: | We study how individuals in six Latin American countries value public versus private provision of education and healthcare using a survey experiment. Respondents were randomly assigned to vignettes that vary income, service quality, and provider type. Reported service quality is the main driver of choices: the probability of selecting a private provider roughly doubles when reported quality of the public option falls from 80 to 20 percent, while income has a smaller effect. Higher institutional trust lowers the likelihood of switching to private providers but does not affect willingness to payonce individuals choose private provision. |
| Keywords: | Stated preferences; Willingness to pay; Public versus private provision;Service quality; Latin America |
| JEL: | D12 H42 I21 I18 O54 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:aoz:wpaper:385 |
| By: | Brooks, Robert D.; Fry, Tim R. L.; Harris, Mark N. |
| Abstract: | This paper conducts a Monte Carlo analysis of the size properties of combining choice set partition tests of the independence of irrelevant alternatives property in the Logit model in the four alternatives setting. Most of the tests have poor size properties. The exception is a version of the test proposed by Small and Hsiao (1985). |
| Keywords: | Research Methods/Statistical Methods |
| URL: | https://d.repec.org/n?u=RePEc:ags:monebs:267754 |
| By: | Yoosoon Chang; Joon Y. Park; Guo Yan |
| Abstract: | The support vector machine (SVM) has an asymptotic behavior that parallels that of the quasi-maximum likelihood estimator (QMLE) for binary outcomes generated by a binary choice model (BCM), although it is not a QMLE. We show that, under the linear conditional mean condition for covariates given the systematic component used in the QMLE slope consistency literature, the slope of the separating hyperplane given by the SVM consistently estimates the BCM slope parameter, as long as the class weight is used as required when binary outcomes are severely imbalanced. The SVM slope estimator is asymptotically equivalent to that of logistic regression in this sense. The finite-sample performance of the two estimators can be quite distinct depending on the distributions of covariates and errors, but neither dominates the other. The intercept parameter of the BCM can be consistently estimated once a consistent estimator of its slope parameter is obtained. |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2601.22659 |
| By: | Zhongjian Lin; Zhentao Shi; Yapeng Zheng |
| Abstract: | This paper studies estimation and inference of heterogeneous peer effects featuring group fixed effects and slope heterogeneity under latent structure. We adapt the Classifier-Lasso algorithm to consistently discover latent structures and determine the number of clusters. To solve the incidental parameter problem in the binary choice model with social interactions, we propose a parametric bootstrap method to debias and establish its asymptotic validity. Monte Carlo simulations confirm strong finite sample performance of our methods. In an application to students' risky behaviors, the algorithm detects two latent clusters and finds that peer effects are significant within one of the clusters, demonstrating the practical applicability in uncovering heterogeneous social interactions. |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2602.06435 |
| By: | Brooks, Robert D.; Fry, Tim R. L.; Harris, Mark N. |
| Abstract: | This paper conducts a Monte Carlo analysis of the size and power properties of combining choice set partition tests of the IIA property of the Logit model. On the basis of this comparison we recommend that applied researchers testing for IIA calculate all versions of the McFadden, Train and Tye (1981) test and reject IIA if any single test .rejects IIA |
| Keywords: | Research Methods/Statistical Methods |
| URL: | https://d.repec.org/n?u=RePEc:ags:monebs:267755 |
| By: | Kolagani Paramahamsa |
| Abstract: | We investigate a seller's revenue-maximizing mechanism in a setting where a desirable good is sold together with an undesirable bad (e.g., advertisements) that generates third-party revenue. The buyer's private information is two-dimensional: valuation for the good and willingness to pay to avoid the bad. Following the duality framework of Daskalakis, Deckelbaum, and Tzamos (2017), whose results extend to our setting, we formulate the seller's problem using a transformed measure $\mu$ that depends on the third-party payment $k$. We provide a near-characterization for optimality of three pricing mechanisms commonly used in practice -- the Good-Only, Ad-Tiered, and Single-Bundle Posted Price -- and introduce a new class of tractable, interpretable two-dimensional orthant conditions on $\mu$ for sufficiency. Economically, $k$ yields a clean comparative static: low $k$ excludes the bad, intermediate $k$ separates ad-tolerant and ad-averse buyers, and high $k$ bundles ads for all types. |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2601.22404 |
| By: | Crichton, Nicola J.; Fry, Timothy R. L. |
| Abstract: | In this paper we will consider the problem of estimating a multinomial logit model for choice behaviour, when the data has been collected using choice—based sampling. We illustrate the estimation process using a set of data collected by the National Association for the Care and Resettlement of Offenders to investigate whether an offender's employment status affected the sentence chosen by the magistrate. |
| Keywords: | Labor and Human Capital, Public Economics |
| URL: | https://d.repec.org/n?u=RePEc:ags:monebs:267069 |
| By: | Harris, Mark N.; Longmire, Ritchard J.; Matyas, Laszlo |
| Abstract: | It is well known that the usual techniques for estimating random and fixed effects panel data models are inconsistent in the dynamic setting. As a consequence, numerous consistent estimators have been proposed in the literature. However, all such estimators rely on certain well defined assumptions, which in practice may often be violated. The purpose of this paper is to ascertain how robust the available estimators are to such misspecifications, thus providing guidance to the applied researcher as to an appropriate choice of estimator in such situations. |
| Keywords: | Research Methods/Statistical Methods |
| URL: | https://d.repec.org/n?u=RePEc:ags:monebs:267911 |
| By: | Umutcan Salman (University of Padova) |
| Abstract: | We develop a revealed preference framework to test whether an aggregate allocation of indivisible objects satisfies Pareto efficiency and individ- ual rationality (PI) without observing individual preferences. Exploiting the type-based preferences of Echenique et al. (2013), we derive necessary and sufficient conditions for PI-rationalizability. We show that an allocation is PI-rationalizable if and only if its allocation graph is acyclic, and equivalently if its associated bipartite graph contains no alternating cycles. The bipartite representation admits a matroid structure, enabling a simple greedy algorithm to measure the severity of PI violations and identify the minimal set of individual–object assignments whose removal restores rationalizability. Our results yield the first complete revealed preference test for PI in matching markets and provide an implementable tool for empirical applications. |
| Keywords: | : Aggregate object allocation, Pareto Efficiency, Individual Rationality, Revealed preferences, Matroid theory |
| URL: | https://d.repec.org/n?u=RePEc:pad:wpaper:0324 |
| By: | François-Charles Wolff (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Nantes Univ - IAE Nantes - Nantes Université - Institut d'Administration des Entreprises - Nantes - Nantes Université - pôle Sociétés - Nantes Univ - Nantes Université); Pierre-Alexandre Mahieu (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Nantes Univ - IAE Nantes - Nantes Université - Institut d'Administration des Entreprises - Nantes - Nantes Université - pôle Sociétés - Nantes Univ - Nantes Université); Brice Trouillet (LETG - Nantes - Littoral, Environnement, Télédétection, Géomatique - UBO EPE - Université de Brest - UR2 - Université de Rennes 2 - CNRS - Centre National de la Recherche Scientifique - LETG - Littoral, Environnement, Télédétection, Géomatique UMR 6554 - UBO EPE - Université de Brest - UR2 - Université de Rennes 2 - CNRS - Centre National de la Recherche Scientifique - Nantes Univ - IGARUN - Institut de Géographie et d'Aménagement Régional de l'Université de Nantes - Nantes Université - pôle Humanités - Nantes Univ - Nantes Université); Alexia Pigeault (LETG - Nantes - Littoral, Environnement, Télédétection, Géomatique - UBO EPE - Université de Brest - UR2 - Université de Rennes 2 - CNRS - Centre National de la Recherche Scientifique - LETG - Littoral, Environnement, Télédétection, Géomatique UMR 6554 - UBO EPE - Université de Brest - UR2 - Université de Rennes 2 - CNRS - Centre National de la Recherche Scientifique - Nantes Univ - IGARUN - Institut de Géographie et d'Aménagement Régional de l'Université de Nantes - Nantes Université - pôle Humanités - Nantes Univ - Nantes Université, CAPACITÉS SAS - Nantes Univ - Nantes Université); Nicolas Rollo (LETG - Nantes - Littoral, Environnement, Télédétection, Géomatique - UBO EPE - Université de Brest - UR2 - Université de Rennes 2 - CNRS - Centre National de la Recherche Scientifique - LETG - Littoral, Environnement, Télédétection, Géomatique UMR 6554 - UBO EPE - Université de Brest - UR2 - Université de Rennes 2 - CNRS - Centre National de la Recherche Scientifique - Nantes Univ - IGARUN - Institut de Géographie et d'Aménagement Régional de l'Université de Nantes - Nantes Université - pôle Humanités - Nantes Univ - Nantes Université) |
| Abstract: | While participatory democracy invites all citizens to take part directly in the decision-making process, the selection of participants in public debates is a critical issue for the legitimacy of the resulting public choices. This paper examines this question in the context of the national public debate on offshore wind energy held in France in the first quarter of 2024. We study an original survey measuring spatial preferences for offshore wind energy in which both participants in the public debate and respondents from the general population were simultaneously surveyed. We find large differences between the two groups of respondents in terms of gender, age, and education, as well as in their spatial preferences for wind farm locations. Using an entropy balancing approach, we reject the hypothesis that these differences in spatial preferences are due to composition effects. These findings underscore the need for policymakers to exercise caution when interpreting the outcomes of public debates. |
| Keywords: | Democracy, Spatial Preferences, Offshore Wind Energy, Discrete Choice Experiment, Entropy Balancing, Participatory |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05473955 |
| By: | Angelo Garate; Felipe Osorio; Federico Crudu |
| Abstract: | The invariance properties of certain likelihood-based asymptotic tests as well as their extensions for M-estimation, estimating functions and the generalized method of moments have been well studied. The simulation study reported in Crudu and Osorio [Econ. Lett. 187: 108885, 2020] shows that the bilinear form test is not invariant to one-to-one transformations of the parameter space. This paper provides a set of suitable conditions to establish the invariance property under reparametrization of the bilinear form test for linear or nonlinear hypotheses that arise in extremum estimation which leads to a simple modification of the test statistic. Evidence from a Monte Carlo simulation experiment suggests good performance of the proposed methodology. |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2602.05592 |
| By: | Jinyong Hahn; Zhipeng Liao; Konrad Menzel; Quang Vuong |
| Abstract: | This paper generalizes the classical Vuong (1989) test to panel data models by employing modified profile likelihoods and the Kullback-Leibler information criterion. Unlike the standard likelihood function, the profile likelihood lacks certain regular properties, making modification necessary. We adopt a generalized panel data framework that incorporates group fixed effects for time and individual pairs, rather than traditional individual fixed effects. Applications of our approach include linear models with non-nested specifications of individual-time effects. |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2601.22354 |