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Estimation Of A Discrete Choice Model When Individual Choices Are Not Observable

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  • Kurkalova, Lyubov A.
  • Rabotyagov, Sergey S.

Abstract

This paper presents an econometric technique for circumventing the lack of individual choice data in a framework of binary choice model by utilizing aggregate choice data. The probability of observing a certain number of individuals making choice A out of the total number of individuals in a group is presented as a sum of probabilities of disjoint events, in which some individuals are picked to make choice A, and others are not. These probabilities are then used to form a likelihood function. The model, which is estimated using the method of maximum likelihood, performs favorably in an application to real discrete choice data.

Suggested Citation

  • Kurkalova, Lyubov A. & Rabotyagov, Sergey S., 2003. "Estimation Of A Discrete Choice Model When Individual Choices Are Not Observable," 2003 Annual meeting, July 27-30, Montreal, Canada 22230, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea03:22230
    DOI: 10.22004/ag.econ.22230
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    References listed on IDEAS

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    1. Douglas J. Miller & Andrew J. Plantinga, 1999. "Modeling Land Use Decisions with Aggregate Data," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(1), pages 180-194.
    2. Miller, Douglas & Plantinga, Andrew J., 1999. "Modeling Land Use Decisions with Aggregate Data," Staff General Research Papers Archive 1487, Iowa State University, Department of Economics.
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