Was Harold Zurcher Myopic After All? Replicating Rust's Engine Replacement Estimates

Christopher Ferrall

No 1467, Working Paper from Economics Department, Queen's University

Abstract: Rust (1987) concludes that the data "clearly reject" the hypothesis that Harold Zurcher made bus replacement decisions using a monthly (and myopic) discount rate of 0 in favor of the factor 0.9999. The alternative model requires the nested fixed point algorithm developed in the paper which became the basis of an ongoing empirical literature. The p-value of the likelihood ratio test was 0.053. Recoding the preferred model and re-processing the raw data reveals two types of errors in the original analysis and a revised p-value of 0.078. This remains below .10, which can be inferred as the significance level that clear rejection was based on. Thus the myopic hypothesis is again rejected although for lower conventional significance levels it would not be.

Pages: 9 pages
Date: 2021-10
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.econ.queensu.ca/sites/econ.queensu.ca/files/wpaper/qed_wp_1467.pdf First version 2021 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:qed:wpaper:1467

Access Statistics for this paper

More papers in Working Paper from Economics Department, Queen's University Contact information at EDIRC.
Bibliographic data for series maintained by Mark Babcock ().