IDEAS home Printed from https://ideas.repec.org/a/wly/iecrev/v61y2020i2p565-571.html
   My bibliography  Save this article

A Comment On “Estimating Dynamic Discrete Choice Models With Hyperbolic Discounting” By Hanming Fang And Yang Wang

Author

Listed:
  • Jaap H. Abbring
  • Øystein Daljord

Abstract

Fang and Wang's (2015) Proposition 2 claims generic identification of a dynamic discrete choice model with hyperbolic discounting under exclusion restrictions. We note that Proposition 2 uses a definition of “generic” that does not preclude that a generically identified model is nowhere identified. We provide two examples of models that are generically identified under this definition, but that are, respectively, everywhere and nowhere identified. We then show that the proof of Proposition 2 is incorrect and incomplete. We conclude that Proposition 2 has no implications for identification of the dynamic discrete choice model and suggest alternative approaches to its identification.

Suggested Citation

  • Jaap H. Abbring & Øystein Daljord, 2020. "A Comment On “Estimating Dynamic Discrete Choice Models With Hyperbolic Discounting” By Hanming Fang And Yang Wang," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 61(2), pages 565-571, May.
    • Handle: RePEc:wly:iecrev:v:61:y:2020:i:2:p:565-571
    DOI: 10.1111/iere.12434
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/iere.12434
    Download Restriction: no
    File URL: https://libkey.io/10.1111/iere.12434?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
    ---><---

    References listed on IDEAS

    as
    1. Rust, John, 1987. "Optimal Replacement of GMC Bus Engines: An Empirical Model of Harold Zurcher," Econometrica, Econometric Society, vol. 55(5), pages 999-1033, September.
    2. Ivar Ekeland & James J. Heckman & Lars Nesheim, 2004. "Identification and Estimation of Hedonic Models," Journal of Political Economy, University of Chicago Press, vol. 112(S1), pages 60-109, February.
    3. Thierry Magnac & David Thesmar, 2002. "Identifying Dynamic Discrete Decision Processes," Econometrica, Econometric Society, vol. 70(2), pages 801-816, March.
    4. V. Joseph Hotz & Robert A. Miller, 1993. "Conditional Choice Probabilities and the Estimation of Dynamic Models," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 60(3), pages 497-529.
    5. Jaap H. Abbring & Øystein Daljord, 2020. "Identifying the discount factor in dynamic discrete choice models," Quantitative Economics, Econometric Society, vol. 11(2), pages 471-501, May.
    6. McManus, Douglas A., 1992. "How common is identification in parametric models?," Journal of Econometrics, Elsevier, vol. 53(1-3), pages 5-23.
    7. Jean-Pierre Dubé & Günter Hitsch & Pranav Jindal, 2014. "The Joint identification of utility and discount functions from stated choice data: An application to durable goods adoption," Quantitative Marketing and Economics (QME), Springer, vol. 12(4), pages 331-377, December.
    8. David Thesmar & Thierry Magnac, 2002. "Identifying dynamic discrete choice models," Post-Print hal-00538062, HAL.
    9. Sargan, J D, 1983. "Identification and Lack of Identification," Econometrica, Econometric Society, vol. 51(6), pages 1605-1633, November.
    10. Brett R. Gordon & Baohong Sun, 2015. "A Dynamic Model of Rational Addiction: Evaluating Cigarette Taxes," Marketing Science, INFORMS, vol. 34(3), pages 452-470, May.
    11. repec:dau:papers:123456789/6486 is not listed on IDEAS
    12. Olivier De Groote & Frank Verboven, 2019. "Subsidies and Time Discounting in New Technology Adoption: Evidence from Solar Photovoltaic Systems," American Economic Review, American Economic Association, vol. 109(6), pages 2137-2172, June.
    13. A. Norets & X. Tang, 2014. "Semiparametric Inference in Dynamic Binary Choice Models," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 81(3), pages 1229-1262.
    14. Robin S. Lee, 2013. "Vertical Integration and Exclusivity in Platform and Two-Sided Markets," American Economic Review, American Economic Association, vol. 103(7), pages 2960-3000, December.
    15. Andrew T. Ching & Tülin Erdem & Michael P. Keane, 2013. "Invited Paper ---Learning Models: An Assessment of Progress, Challenges, and New Developments," Marketing Science, INFORMS, vol. 32(6), pages 913-938, November.
    16. Andriy Norets & Xun Tang, 2010. "Semiparametric Inference in Dynamic Binary Choice Models, Second Version," PIER Working Paper Archive 12-017, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 17 Apr 2012.
    17. Hanming Fang & Yang Wang, 2015. "Estimating Dynamic Discrete Choice Models With Hyperbolic Discounting, With An Application To Mammography Decisions," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 56, pages 565-596, May.
    18. Patrick Bajari & Chenghuan Sean Chu & Denis Nekipelov & Minjung Park, 2016. "Identification and semiparametric estimation of a finite horizon dynamic discrete choice model with a terminating action," Quantitative Marketing and Economics (QME), Springer, vol. 14(4), pages 271-323, December.
    19. Marc K. Chan, 2017. "Welfare Dependence and Self-Control: An Empirical Analysis," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 84(4), pages 1379-1423.
    20. Andrew T. Ching & Tülin Erdem & Michael P. Keane, 2013. "Learning Models: An Assessment of Progress, Challenges and New Developments," Economics Papers 2013-W07, Economics Group, Nuffield College, University of Oxford.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Chao Wang & Stefan Weiergraeber & Ruli Xiao, 2022. "Identification of Dynamic Discrete Choice Models with Hyperbolic Discounting Using a Terminating Action," CAEPR Working Papers 2022-010 Classification-C, Center for Applied Economics and Policy Research, Department of Economics, Indiana University Bloomington.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jaap H. Abbring & Øystein Daljord, 2020. "Identifying the discount factor in dynamic discrete choice models," Quantitative Economics, Econometric Society, vol. 11(2), pages 471-501, May.
    2. Andrew T. Ching & Masakazu Ishihara, 2018. "Identification of Dynamic Models of Rewards Programme," The Japanese Economic Review, Japanese Economic Association, vol. 69(3), pages 306-323, September.
    3. Schiraldi, Pasquale & Levy, Matthew R., 2020. "Identification of intertemporal preferences in history-dependent dynamic discrete choice models," CEPR Discussion Papers 14447, C.E.P.R. Discussion Papers.
    4. Myrto Kalouptsidi & Paul T. Scott & Eduardo Souza-Rodrigues, 2018. "Linear IV Regression Estimators for Structural Dynamic Discrete Choice Models," NBER Working Papers 25134, National Bureau of Economic Research, Inc.
    5. Jason R. Blevins & Wei Shi & Donald R. Haurin & Stephanie Moulton, 2020. "A Dynamic Discrete Choice Model Of Reverse Mortgage Borrower Behavior," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 61(4), pages 1437-1477, November.
    6. Kalouptsidi, Myrto & Scott, Paul T. & Souza-Rodrigues, Eduardo, 2021. "Linear IV regression estimators for structural dynamic discrete choice models," Journal of Econometrics, Elsevier, vol. 222(1), pages 778-804.
    7. Abbring, Jaap & Daljord, Øystein, 2016. "Identifying the Discount Factor in Dynamic Discrete Choice Models," CEPR Discussion Papers 11133, C.E.P.R. Discussion Papers.
    8. Patrick Bajari & Chenghuan Sean Chu & Denis Nekipelov & Minjung Park, 2016. "Identification and semiparametric estimation of a finite horizon dynamic discrete choice model with a terminating action," Quantitative Marketing and Economics (QME), Springer, vol. 14(4), pages 271-323, December.
    9. Sebastian Galiani & Juan Pantano, 2021. "Structural Models: Inception and Frontier," NBER Working Papers 28698, National Bureau of Economic Research, Inc.
    10. Kalouptsidi, Myrto & Scott, Paul T. & Souza-Rodrigues, Eduardo, 2018. "Linear IV Regression Estimators for Structural Dynamic Discrete Choice Models," CEPR Discussion Papers 13240, C.E.P.R. Discussion Papers.
    11. Schneider, Ulrich, 2019. "Identification of Time Preferences in Dynamic Discrete Choice Models: Exploiting Choice Restrictions," MPRA Paper 102137, University Library of Munich, Germany, revised 29 Jul 2020.
    12. Myrto Kalouptsidi & Paul T. Scott & Eduardo Souza‐Rodrigues, 2021. "Identification of counterfactuals in dynamic discrete choice models," Quantitative Economics, Econometric Society, vol. 12(2), pages 351-403, May.
    13. Andrew T. Ching & Matthew Osborne, 2020. "Identification and Estimation of Forward-Looking Behavior: The Case of Consumer Stockpiling," Marketing Science, INFORMS, vol. 39(4), pages 707-726, July.
    14. Doug J. Chung & Byungyeon Kim & Byoung G. Park, 2021. "The Comprehensive Effects of Sales Force Management: A Dynamic Structural Analysis of Selection, Compensation, and Training," Management Science, INFORMS, vol. 67(11), pages 7046-7074, November.
    15. Øystein Daljord & Denis Nekipelov & Minjung Park, 2019. "Comments on “identification and semiparametric estimation of a finite horizon dynamic discrete choice model with a terminating action”," Quantitative Marketing and Economics (QME), Springer, vol. 17(4), pages 439-449, December.
    16. Arcidiacono, Peter & Miller, Robert A., 2020. "Identifying dynamic discrete choice models off short panels," Journal of Econometrics, Elsevier, vol. 215(2), pages 473-485.
    17. Kalouptsidi, Myrto & Scott, Paul & Souza-Rodrigues, Edouardo, 2015. "Identification of Counterfactuals and Payoffs in Dynamic Discrete Choice with an Application to Land Use," TSE Working Papers 15-596, Toulouse School of Economics (TSE).
    18. Kalouptsidi, Myrto & Souza-Rodrigues, Eduardo & Scott, Paul, 2017. "Identification of Counterfactuals in Dynamic Discrete Choice Models," CEPR Discussion Papers 12470, C.E.P.R. Discussion Papers.
    19. Sasaki, Yuya & Takahashi, Yuya & Xin, Yi & Hu, Yingyao, 2023. "Dynamic discrete choice models with incomplete data: Sharp identification," Journal of Econometrics, Elsevier, vol. 236(1).
    20. Taiga Tsubota, 2021. "Identifying Dynamic Discrete Choice Models with Hyperbolic Discounting," Papers 2111.10721, arXiv.org, revised Oct 2024.

    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:wly:iecrev:v:61:y:2020:i:2:p:565-571. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/deupaus.html .

    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.