A Dynamic Formulation for Car Ownership Modeling

Cinzia Cirillo (), Renting Xu () and Fabian Bastin ()
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Cinzia Cirillo: Department of Civil and Environmental Engineering, University of Maryland, College Park, Maryland 20742; and Centre interuniversitaire de recherche sur les reseaux d’entreprise, la logistique et le transport (CIRRELT), Montréal, Québec H3C 3J7, Canada
Renting Xu: Nielsen Audio, Columbia, Maryland 21046
Fabian Bastin: Centre interuniversitaire de recherche sur les reseaux d’entreprise, la logistique et le transport (CIRRELT), Montréal, Québec H3C 3J7, Canada; and Department of Computer Science and Operations Research, University of Montréal, Montréal, Québec H3T 1J4, Canada

Transportation Science, 2016, vol. 50, issue 1, 322-335

Abstract: Discrete choice models are commonly used in transportation planning and modeling, but their theoretical basis and applications have been mainly developed in a static context. In this paper, we propose an estimation technique for analyzing the impact of technological changes on the dynamic of consumer demand. The proposed research presents a dynamic formulation that explicitly models market evolution and accounts for consumers’ expectations of future product characteristics. The timing of consumers’ decisions is formulated as a regenerative optimal stopping problem where the agent must decide on the optimal time of purchase. This model frame will be further improved by modeling the choice from a set of differentiated products whose characteristics randomly change over time. The framework proposed is developed and applied in the context of car ownership.

Keywords: dynamic decisions; discrete choice models; car ownership (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:inm:ortrsc:v:50:y:2016:i:1:p:322-335

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