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Specification of regret-based models of choice behaviour: formal analyses and experimental design based evidence—commentary

Author

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  • Caspar G. Chorus

    (Delft University of Technology)

  • Sander Cranenburgh

    (Delft University of Technology)

Abstract

A recent paper published in this journal compares two regret based choice models, and concludes that one of them is theoretically inferior and has a worse empirical performance in the context of a particular data set [Rasouli and Timmermans, Transportation 6:1–22, 2016]. Unfortunately, those conclusions are ill-founded as they are based on a misinterpretation and misrepresentation of one of the two considered models. Furthermore, the paper overlooks highly relevant recent work on the topic, and contains insufficient empirical analyses. Together, these issues make that the paper provides a confusing addition to the literature. With the aim of lifting some of this confusion, this commentary sets out to highlight, and correct where possible, the paper’s shortcomings.

Suggested Citation

  • Caspar G. Chorus & Sander Cranenburgh, 2018. "Specification of regret-based models of choice behaviour: formal analyses and experimental design based evidence—commentary," Transportation, Springer, vol. 45(1), pages 247-256, January.
    • Handle: RePEc:kap:transp:v:45:y:2018:i:1:d:10.1007_s11116-016-9739-x
    DOI: 10.1007/s11116-016-9739-x
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    References listed on IDEAS

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    1. David E. Bell, 1982. "Regret in Decision Making under Uncertainty," Operations Research, INFORMS, vol. 30(5), pages 961-981, October.
    2. Chorus, Caspar & van Cranenburgh, Sander & Dekker, Thijs, 2014. "Random regret minimization for consumer choice modeling: Assessment of empirical evidence," Journal of Business Research, Elsevier, vol. 67(11), pages 2428-2436.
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    4. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    5. Quiggin, John, 1994. "Regret Theory with General Choice Sets," Journal of Risk and Uncertainty, Springer, vol. 8(2), pages 153-165, March.
    6. Chorus, Caspar G., 2014. "A Generalized Random Regret Minimization model," Transportation Research Part B: Methodological, Elsevier, vol. 68(C), pages 224-238.
    7. Boeri, Marco & Scarpa, Riccardo & Chorus, Caspar G., 2014. "Stated choices and benefit estimates in the context of traffic calming schemes: Utility maximization, regret minimization, or both?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 61(C), pages 121-135.
    8. van Cranenburgh, Sander & Guevara, Cristian Angelo & Chorus, Caspar G., 2015. "New insights on random regret minimization models," Transportation Research Part A: Policy and Practice, Elsevier, vol. 74(C), pages 91-109.
    9. Amos Tversky & Daniel Kahneman, 1991. "Loss Aversion in Riskless Choice: A Reference-Dependent Model," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(4), pages 1039-1061.
    10. Loomes, Graham & Sugden, Robert, 1982. "Regret Theory: An Alternative Theory of Rational Choice under Uncertainty," Economic Journal, Royal Economic Society, vol. 92(368), pages 805-824, December.
    11. van Cranenburgh, Sander & Prato, Carlo G., 2016. "On the robustness of random regret minimization modelling outcomes towards omitted attributes," Journal of choice modelling, Elsevier, vol. 18(C), pages 51-70.
    12. Chorus, Caspar G. & Arentze, Theo A. & Timmermans, Harry J.P., 2008. "A Random Regret-Minimization model of travel choice," Transportation Research Part B: Methodological, Elsevier, vol. 42(1), pages 1-18, January.
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