A discrete choice model incorporating thresholds for perception in attribute values

Victor Cantillo, Benjamin Heydecker and Juan de Dios Ortúzar

Transportation Research Part B: Methodological, 2006, vol. 40, issue 9, 807-825

Abstract: In this paper we formulate a discrete choice model that incorporates thresholds in the perception of changes in attribute values. The model considers multiple options and allows for changes in several attributes. We postulate that if thresholds exist they could be random, differ between individuals, and even be a function of socio-economic characteristics and choice conditions. Our formulation allows estimation of the parameters of the threshold probability distribution starting from information about choices. The model is applied to synthetic data and also to real data from a stated preference survey. We found that where perception thresholds exist in the population, the use of models without them leads to errors in estimation and prediction. Clearly, the effect is more relevant when the typical size of change in the attribute value is comparable with the threshold, and when the contribution of this attribute in the utility function is substantial. Finally, we discuss the implications of the threshold model for estimation of the benefits of transport investments, and show that where thresholds exist, models that do not represent them can overestimate benefits substantially.

Date: 2006
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (55)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0191-2615(05)00135-9
Full text for ScienceDirect subscribers only

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:eee:transb:v:40:y:2006:i:9:p:807-825

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/supportfaq.cws_home/regional
https://shop.elsevie ... _01_ooc_1&version=01

Access Statistics for this article

Transportation Research Part B: Methodological is currently edited by Fred Mannering

More articles in Transportation Research Part B: Methodological from Elsevier
Bibliographic data for series maintained by Catherine Liu ().