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on Discrete Choice Models |
| By: | Joy Buchanan; Joshua Foster |
| Abstract: | Language models increasingly settle real resource tradeoffs on behalf of principals yet their economic preferences remain unobserved. We demonstrate their generation rule is isomorphic to the random utility model of discrete choice. This allows internal logit scores to structurally identify preferences. Estimating risk attitudes across twelve models in a portfolio task reveals universal but heterogeneous risk aversion. Although models reject strictly dominated options, their elicited preferences fail invariance tests and violate the independence of irrelevant alternatives across varying experimental prompts. Finally, fine tuning establishes that a principal can explicitly engineer a target risk attitude. |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2607.26288 |
| By: | Tatiana Komarova |
| Abstract: | This paper analyzes when choice probabilities reveal rankings of deterministic utility indices in semiparametric discrete choice models. It begins with binary choice, where quantile thresholds guarantee ranking recovery, and shows that such thresholds can arise either from behavioral departures from utility maximization (e.g., limited attention) under exchangeable unobservables, or from non-exchangeable unobservables under standard utility maximization. These behavioral and distributional routes are then extended to multinomial choice. Under limited attention, balance restrictions on attention probabilities yield global linear ranking partitions which are robust to the distribution of unobservables and, given sufficiently rich joint variation in the differences of utility indices, are also necessary. Absent the required attention restrictions, opposite rankings can produce overlapping probability images. Under non-exchangeable unobservables, a comparable distribution-uniform partition generally need not exist. Holding the distribution fixed, however, ranking recovery remains possible via an injective nonlinear map from normalized utility differences to choice probabilities under both behavioral and distributional extensions. Together, the results distinguish distribution-robust global ranking partitions from ranking recovery with a fixed distribution of unobservables and clarify the limits of extending binary quantile restrictions to multinomial choice. |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2608.16708 |
| By: | Donnelly, Emma; Reeling, Carson; Melstrom, Richard; Phelps, W. Adam |
| Abstract: | We estimate willingness to pay (WTP) for a hypothetical sandhill crane (Antigone canadensis) hunting permit using contingent valuation, based on a mail survey of Indiana hunters. The hypothetical permit would allow hunting over a two-month season. Permit attributes in the experiment include price, individual harvest limits, and a seasonal quota. We find mean WTP is $61 and sensitive to scope, which supports the internal validity of the valuation estimate. Understanding the benefits of hunting is important as resource managers consider initiating new harvest seasons. No prior studies have estimated WTP for sandhill crane hunting, so these results provide a baseline for future benefit transfer applications in wildlife economics. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404451 |
| By: | Kai Wang |
| Abstract: | Empirical and experimental studies suggest that a decision maker can remain with their default option even when preferred alternatives are available, yet standard choice data may not record which option is the default. Existing default-based models often assume that the default option is observed. In contrast, I study a decision maker subject to status quo bias and choice overload and illustrate how one can identify both the decision maker's default and preference from the observed behavior. This paper shows that anomalous choice behavior may arise from a latent default, a possibility largely overlooked in studies of standard choice data. |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2608.07298 |
| By: | Albarracín, Dolores; Hyde, Timothy (Department of Economics, Oberlin College) |
| Abstract: | Flood risk disclosure is expanding rapidly in real estate markets, but if disclosures move demand by commanding attention rather than by conveying information, theirwelfare effects are ambiguous. We examine this tension in a discrete choice experiment where 1, 498 respondents make hypothetical choices among real Gulf Coast properties under a control condition and four disclosure formats varying in informational content and presentation. Absent disclosure, insurance costs barely influence choices; by contrast, when respondents are shown precise flood insurance estimates, they are willing to pay $3.34 in annualized housing costs to avoid each annual premium dollar. Using a separate beliefs elicitation, we estimate each format’s technical information content and construct a Bayesian benchmark for how much choices should respond. Observed responses exceed this benchmark by a factor of four to six; informational content accounts for at most 30 percent of the response to any format. |
| Keywords: | Flood risk, Risk disclosure, Salience, Attention, Willingness to pay, Stated preferences |
| JEL: | D83 D91 Q54 R31 G22 |
| Date: | 2026–07–01 |
| URL: | https://d.repec.org/n?u=RePEc:cxv:wpaper:2603 |
| By: | Pereira, Olívia S; Jacobsen, Mark; Carson, Richard; Cortés, Jorge; Levin, Lisa A |
| Abstract: | Methane seeps are highly productive ecosystems that provide carbon sequestration services, host diverse communities including endemic species, and serve as habitats for commercial fisheries. Little is known about the economic value the public places on them. Discrete Choice Experiments (DCEs) are administered to a sample of Costa Rican taxpayers to evaluate their willingness to pay (WTP) in monetary terms using tradeoffs made in a survey context involving three of the main attributes of methane seep ecosystems to provide insights for future conservation and management efforts. Extensive effort is devoted to understanding how Costa Ricans view different aspects of the deep sea. We find that they associate it with strange animals, natural resources, the unknown, and being far from reach. Perhaps surprisingly, they underestimate how much they know about the deep sea. We find that WTP for methane seep protection is the highest for programs that protect seeps with endemic species, followed by seeps with high climate change mitigation potential and commercial fishing habitat. Higher-income groups and women are more likely to prefer options that increase the current level of protection. We discuss how science communication and community engagement contribute to care expressed toward the deep sea. |
| Keywords: | 38 Economics (for-2020), 3801 Applied Economics (for-2020), 15 Life on Land (sdg), Choice modelling, Deep sea, Ecosystem services, Existence value, Methane seeps, 0502 Environmental Science and Management (for), 1402 Applied Economics (for), 1499 Other Economics (for), Agricultural Economics & Policy (science-metrix), 3103 Ecology (for-2020), 3801 Applied economics (for-2020), 3899 Other economics (for-2020) |
| Date: | 2024–09–01 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:ucsdec:qt87w646zx |
| By: | Taj, Tanjum Afrin; Elbakidze, Levan; Hwang, Julian |
| Abstract: | Per- and polyfluoroalkyl substances (PFAS) are harmful and persistent synthetic chemicals widely detected in U.S. surface water, groundwater, and public drinking water systems. Although the EPA introduced national drinking water standards for selected PFAS compounds, the economic benefits of mitigating PFAS in drinking water remain unquantified. We estimate willingness to pay (WTP) for removing PFAS from all publicly supplied drinking water in the U.S. using an online dichotomous choice contingent valuation survey. The results show that aggregate annual benefits of a national PFAS drinking water remediation program range from $104.1 billion to $111.7 billion. WTP is higher when PFAS are detected in the respondent’s local drinking water supply, while provision of information about exposure to PFAS via other pathways besides drinking water, including consumer goods, has no significant impact. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404489 |
| By: | De Marchi, Elisa; Banterle, Alessandro; Cavaliere, Alessia; Fadini, Irene |
| Keywords: | Research Methods/Statistical Methods |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404520 |
| By: | Mogens Fosgerau; Nikolaj Nielsen; Thomas Rasmussen; Rui Yao |
| Abstract: | We provide an estimator for the perturbed utility route choice (PURC) model that works with data at the level of individual trips. The estimator is a nested fixed-point algorithm that combines an upper bias-corrected linear regression problem with a lower individual-level perturbed utility maximization problem. We establish the statistical properties of the microPURC estimator and confirm these results with an experiment using simulated data. Finally, we demonstrate the estimator in practice using a large real-world dataset. |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2608.11464 |
| By: | Lee, Gyuchan |
| Abstract: | This paper examines how consumers respond to different forms of soda tax information under tax-inclusive pricing. Using a randomized pre–post discrete choice experiment (DCE) in China, we isolate informational effects while holding tax-inclusive prices constant. Difference-in-differences comparisons and mixed logit estimates show that informing consumers that the displayed soda price includes a soda tax reduces regular soda demand relative to a price-only control group, while explicit disclosure of the tax amount produces larger demand reductions and higher implied price elasticity. The estimates suggest that tax information primarily reduces the perceived attractiveness of regular soda, whereas explicit tax disclosure increases price sensitivity. These findings suggest that tax-inclusive pricing alone may not ensure full tax salience and that disclosure design may complement corrective taxation beyond the standard price effect. |
| Keywords: | Food Consumption/Nutrition/Food Safety |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404547 |
| By: | Hu, Chenxi; Gao, Zhifeng; Jing, Yifan; Zhao, Xin; Sims, Charles A. |
| Keywords: | Institutional and Behavioral Economics |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404431 |
| By: | Guiso, Luigi; Jappelli, Tullio |
| Abstract: | We implement a survey experiment to study whether awareness of the consequences of hydrogeological risk affects people’s willingness to fight it. To do so, we leverage a representative panel of 5, 000 Italian individuals interviewed at quarterly frequency, starting in October 2023. We elicit survey participants’ willingness to contribute to a public fund to finance investment to secure areas exposed to hydrogeological risk under different information treatments. We find that disclosing information about the consequences of hydrogeological risk causes individuals to increase both support for public funding and individual willingness to pay for the policy. Compared to the control group, individuals exposed to the treatment were 9 percentage points more likely to contribute to the fund and more willing to contribute an additional €29. Applying the information treatment to the whole working age population could raise as much as €0.26 billion per year. We provide evidence that individual willingness to pay depends on individual knowledge that the success of the policy depends critically on the willingness to pay of other citizens. |
| JEL: | H31 H2 H23 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19280 |
| By: | Diekert, Florian; Eymess, Tillmann; Goeschl, Timo; Gomez-Cardona, Santiago; Luomba, Joseph |
| Abstract: | We present a novel mechanism to elicit the willingness to pay (WTP) for multiple rather than for single units of a good. At each price of the canonical multiple price list (MPL) approach, we elicit varying multi-unit demand instead of the options whether to buy one unit or not. The multi-unit MPL (muMPL) retains the simplicity of the MPL without adding much complexity, is field-ready, and generates rich, truthful, and reasonably precise WTP data to estimate a demand curve. Finally, we showcase our mechanism in a challenging field environment. |
| Keywords: | Research Methods/Statistical Methods |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404725 |
| By: | Wang, Chang |
| Abstract: | Coastal property markets are influenced by unique environmental attributes, yet traditional models often assume their economic value is spatially constant. This study investigates the spatial heterogeneity of beach proximity value in Glynn County, Georgia, using a geographically weighted spatial lag (GWSL) hedonic model. By analyzing 42, 152 residential transactions from 1984 to 2021, we find that the effect of beach proximity on house prices is highly non-stationary, with significant capitalization concentrated in barrier islands. Our results reveal a powerful spatial multiplier, which indicates that property wealth is highly socialized through localized price spillovers. Applying individual local parameters, we estimate a mean Total Marginal Willingness to Pay (MWTP) of $1.06 million for a 100-meter reduction in network distance to the shoreline. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404453 |