Customer-Specific Taste Parameters and Mixed Logit: Households' Choice of Electricity Supplier

David Revelt and Kenneth Train.
Authors registered in the RePEc Author Service: Kenneth Train ()

No E00-274, Economics Working Papers from University of California at Berkeley

Abstract: David Revelt and Kenneth Train.
JEL#: C25, D12, L94.
Keywords: energy suppliers, mixed logit, taste parameters
In a discrete choice situation, information about the tastes of each sampled customer is inferred from estimates of the distribution of tastes in the population. First, maximum likelihood procedures are used to estimate the distribution of tastes in the population using the pooled data for all sampled customers. Then, the distribution of tastes of each sampled customer is derived conditional on the observed data for that customer and the estimated population distribution of tastes (accounting for uncertainty in the population estimates.) We apply the method to data on residential customers' choice among energy suppliers in conjoint-type experiments. The estimated distribution of tastes provides practical information that is useful for suppliers in designing their offers. The conditioning for individual customers is found to differentiate customers effectively for marketing purposes and to improve considerably the predictions in new situations.
May 2000

New Economics Papers: this item is included in nep-dcm and nep-ene
Date: Written
View list of references View citations in EconPapers

Downloads: (external link)
http://www.haas.berkeley.edu/groups/iber/wps/econ/E00-274.pdf main text (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.haas.berkeley.edu/groups/iber/wps/econ/E00-274.pdf [302 Found]--> http://iber.berkeley.edu/wps/econ/E00-274.pdf)

Related works:
Working Paper: Customer-Specific Taste Parameters and Mixed Logit: Households' Choice of Electricity Supplier (2001)
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: http://EconPapers.repec.org/RePEc:ucb:calbwp:e00-274

Ordering information: This working paper can be ordered from
IBER, F502 Haas Building, University of California, Berkeley CA 94720-1922

Access Statistics for this paper

More papers in Economics Working Papers from University of California at Berkeley
Address: University of California at Berkeley, Berkeley, CA USA
Contact information at EDIRC.
Series data maintained by Christopher F. Baum ().