IDEAS home Printed from https://ideas.repec.org/a/taf/applec/v47y2015i39p4153-4167.html
   My bibliography  Save this article

Model selection and misspecification in discrete choice welfare analysis

Author

Listed:
  • Ju-Chin Huang
  • Min Qiang Zhao

Abstract

This study extends the work by Herriges and Kling (1997) to further evaluate the impact of discrete choice modelling techniques on welfare measures. Particularly, we evaluate the performance of the increasingly popular mixed logit model and the computational strategy for deriving discrete choice welfare measures. Our simulation results show that model misspecification can have profound effects on welfare measures. In general, the flexible mixed logit model performs relatively well in the presence of misspecification. However, when the nesting structure can be appropriately identified (via statistical tests and a priori knowledge/experience), the nested logit model provides more reliable welfare measures than the mixed logit model.

Suggested Citation

  • Ju-Chin Huang & Min Qiang Zhao, 2015. "Model selection and misspecification in discrete choice welfare analysis," Applied Economics, Taylor & Francis Journals, vol. 47(39), pages 4153-4167, August.
  • Handle: RePEc:taf:applec:v:47:y:2015:i:39:p:4153-4167
    DOI: 10.1080/00036846.2015.1026581
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/00036846.2015.1026581
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1080/00036846.2015.1026581?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Muhammad Bello & Awudu Abdulai, 2016. "Measuring heterogeneity, survey engagement and response quality in preferences for organic products in Nigeria," Applied Economics, Taylor & Francis Journals, vol. 48(13), pages 1159-1171, March.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:applec:v:47:y:2015:i:39:p:4153-4167. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RAEC20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.