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Interactive Agency Choice in Automobile Purchase Decisions: The Role of Negotiation in Determining Equilibrium Choice Outcomes

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  • David A. Hensher
  • John M. Rose
  • Ian Black

Abstract

There is a renewed interest in the development of behavioural models designed to identify the major determinants of household vehicle purchase. This is due, in part, to the growing interest in the economic viability of the automobile industry, rising fuel costs and increasing enhanced greenhouse gas emissions. The focus of all known research activity is on establishing the preferences for specific vehicle attributes from a single member of a household, almost oblivious to a recognised position that automobile purchase choices are commonly made by more than one decision maker. In this paper we briefly review the state of the art in vehicle purchase decision models, and set out a framework for interactive agency review and assessment of alternatives in the context of two agents negotiating the purchase of an automobile. We estimate a sequence of mixed logit models to illustrate how the method is implemented to accommodate the role of each agent. © 2008 LSE and the University of Bath

Suggested Citation

  • David A. Hensher & John M. Rose & Ian Black, 2008. "Interactive Agency Choice in Automobile Purchase Decisions: The Role of Negotiation in Determining Equilibrium Choice Outcomes," Journal of Transport Economics and Policy, University of Bath, vol. 42(2), pages 269-296, May.
    • Handle: RePEc:tpe:jtecpo:v:42:y:2008:i:2:p:269-296
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    Cited by:

    1. Chorus, Caspar G., 2015. "Models of moral decision making: Literature review and research agenda for discrete choice analysis," Journal of choice modelling, Elsevier, vol. 16(C), pages 69-85.
    2. Marit Kragt & Jeffrey Bennett, 2012. "Attribute Framing in Choice Experiments: How Do Attribute Level Descriptions Affect Value Estimates?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 51(1), pages 43-59, January.
    3. Rungie, Cam & Scarpa, Riccardo & Thiene, Mara, 2014. "The influence of individuals in forming collective household preferences for water quality," Journal of Environmental Economics and Management, Elsevier, vol. 68(1), pages 161-174.
    4. Yan, Qianqian & Feng, Tao & Timmermans, Harry, 2023. "A model of household shared parking decisions incorporating equity-seeking household dynamics and leadership personality traits," Transportation Research Part A: Policy and Practice, Elsevier, vol. 169(C).
    5. Martina Menon & Federico Perali & Marcella Veronesi, 2014. "Recovering Individual Preferences for Non-Market Goods: A Collective Travel-Cost Model," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 96(2), pages 438-457.
    6. Small, Kenneth A., 2012. "Valuation of travel time," Economics of Transportation, Elsevier, vol. 1(1), pages 2-14.
    7. Mariel, Petr & Scarpa, Riccardo & Vega-Bayo, Ainhoa, 2018. "Joint parental school choice: Exploring the influence of individual preferences of husbands and wives," Regional Science and Urban Economics, Elsevier, vol. 68(C), pages 23-35.
    8. Lu, Ying & Prato, Carlo G. & Sipe, Neil & Kimpton, Anthony & Corcoran, Jonathan, 2022. "The role of household modality style in first and last mile travel mode choice," Transportation Research Part A: Policy and Practice, Elsevier, vol. 158(C), pages 95-109.
    9. Matthew J. Beck & John M. Rose, 2019. "Stated preference modelling of intra-household decisions: Can you more easily approximate the preference space?," Transportation, Springer, vol. 46(4), pages 1195-1213, August.
    10. Edoardo Marcucci & Amanda Stathopoulos & Lucia Rotaris & Romeo Danielis, 2011. "Comparing Single and Joint Preferences: A Choice Experiment on Residential Location in Three-Member Households," Environment and Planning A, , vol. 43(5), pages 1209-1225, May.
    11. Bliemer, Michiel C.J. & Rose, John M., 2011. "Experimental design influences on stated choice outputs: An empirical study in air travel choice," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(1), pages 63-79, January.
    12. Vikki O’Neill & Stephane Hess, 2014. "Heterogeneity assumptions in the specification of bargaining models: a study of household level trade-offs between commuting time and salary," Transportation, Springer, vol. 41(4), pages 745-763, July.
    13. David Hensher & Matthew Beck & John Rose, 2011. "Accounting for Preference and Scale Heterogeneity in Establishing Whether it Matters Who is Interviewed to Reveal Household Automobile Purchase Preferences," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 49(1), pages 1-22, May.

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