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Context dependent process heuristics and choice analysis – A note on two interacting themes linked to behavioural realism

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  • Hensher, David A.

Abstract

This note is written to remind us of the recognition of behavioural realism in the economic literature over 60 years ago, which seems to have been given limited recognition in the formal axiomatic development of economic theories commonly associated with the application of discrete choice models, especially where the interest is on obtaining welfare measures such as willingness to pay estimates of specific attributes for use in cost-benefit analysis. We need to be reminded from time to time of the importance of context dependency in defining a choice problem and the value that behavioural realism can add despite risks of violating often some axioms of economic rationality and utility maximisation.

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  • Hensher, David A., 2019. "Context dependent process heuristics and choice analysis – A note on two interacting themes linked to behavioural realism," Transportation Research Part A: Policy and Practice, Elsevier, vol. 125(C), pages 119-122.
    • Handle: RePEc:eee:transa:v:125:y:2019:i:c:p:119-122
    DOI: 10.1016/j.tra.2019.05.015
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    References listed on IDEAS

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    1. Caspar G. Chorus, 2012. "Random Regret-based Discrete Choice Modeling," SpringerBriefs in Business, Springer, edition 127, number 978-3-642-29151-7, October.
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    3. Thijs Dekker & Caspar G. Chorus, 2018. "Consumer surplus for random regret minimisation models," Journal of Environmental Economics and Policy, Taylor & Francis Journals, vol. 7(3), pages 269-286, July.
    4. Richard Batley & J. Nicolás Ibá-ez, 2013. "Applied welfare economics with discrete choice models: implications of theory for empirical specification," Chapters, in: Stephane Hess & Andrew Daly (ed.), Choice Modelling, chapter 7, pages 144-171, Edward Elgar Publishing.
    5. McConnell K. E., 1995. "Consumer Surplus from Discrete Choice Models," Journal of Environmental Economics and Management, Elsevier, vol. 29(3), pages 263-270, November.
    6. Batley, Richard & Nicolás Ibáñez, J., 2013. "On the path independence conditions for discrete-continuous demand," Journal of choice modelling, Elsevier, vol. 7(C), pages 13-23.
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