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Mixture models of choice under risk

Anna Conte, John Hey and Peter Moffatt

Journal of Econometrics, 2011, vol. 162, issue 1, 79-88

Abstract: This paper is concerned with estimating preference functionals for choice under risk from the choice behaviour of individuals. We note that there is heterogeneity in behaviour between individuals and within individuals. By 'heterogeneity between individuals' we mean that people are different, in terms of both their preference functionals and their parameters for these functionals. By 'heterogeneity within individuals' we mean that the behaviour may be different even by the same individual for the same choice problem. We propose methods of taking into account all forms of heterogeneity, concentrating particularly on using a Mixture Model to capture the heterogeneity of preference functionals.

Keywords: Expected; utility; theory; Maximum; simulated; likelihood; Mixture; models; Rank; dependent; expected; utility; theory; Heterogeneity (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (79)

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Related works:
Chapter: Mixture models of choice under risk (2018) Downloads
Working Paper: Mixture Models of Choice Under Risk (2007) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:eee:econom:v:162:y:2011:i:1:p:79-88

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