Please use this identifier to cite or link to this item: http://hdl.handle.net/1893/20888
Appears in Collections:Economics Journal Articles
Peer Review Status: Refereed
Title: Bounding WTP distributions to reflect the 'actual'consideration set
Authors: Campbell, Danny
Hensher, David A
Scarpa, Riccardo
Contact Email: danny.campbell@stir.ac.uk
Keywords: Independent availability logit model
Combined latent class mixed logit model
Willingness to pay
Consideration set
Cost threshold
Elimination-by-aspects
Issue Date: Jun-2014
Publisher: Elsevier
Citation: Campbell D, Hensher DA & Scarpa R (2014) Bounding WTP distributions to reflect the 'actual'consideration set, Journal of Choice Modelling, 11, pp. 4-15.
Abstract: In this paper we extend the independent availability logit and combined latent class mixed logit models to accommodate respondents with different consideration sets due to their cost thresholds and cut-offs. Pertinent features of our model are that it is estimated in WTP-space and that the class-specific WTP distributions are truncated to be within the bounds deduced from the cost level(s) within each class-specific consideration set. Our analysis shows that our approach is well suited at uncovering the heterogeneity in the cost thresholds and cut-offs used by respondents. This is shown to help build a richer insight into respondent׳s behaviour as well as raise a number of concerns about the appropriateness of assuming deterministic choice sets. We discuss the implications of our results for welfare analysis.
Type: Journal Article
URI: http://hdl.handle.net/1893/20888
DOI Link: http://dx.doi.org/10.1016/j.jocm.2014.02.004
Rights: The publisher does not allow this work to be made publicly available in this Repository. Please use the Request a Copy feature at the foot of the Repository record to request a copy directly from the author. You can only request a copy if you wish to use this work for your own research or private study.
Affiliation: Economics
University of Sydney
University of Waikato

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