Deep Neural Networks for Choice Analysis: Architectural Design with Alternative-Specific Utility Functions

Shenhao Wang, Baichuan Mo and Jinhua Zhao

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Abstract: Whereas deep neural network (DNN) is increasingly applied to choice analysis, it is challenging to reconcile domain-specific behavioral knowledge with generic-purpose DNN, to improve DNN's interpretability and predictive power, and to identify effective regularization methods for specific tasks. This study designs a particular DNN architecture with alternative-specific utility functions (ASU-DNN) by using prior behavioral knowledge. Unlike a fully connected DNN (F-DNN), which computes the utility value of an alternative k by using the attributes of all the alternatives, ASU-DNN computes it by using only k's own attributes. Theoretically, ASU-DNN can dramatically reduce the estimation error of F-DNN because of its lighter architecture and sparser connectivity. Empirically, ASU-DNN has 2-3% higher prediction accuracy than F-DNN over the whole hyperparameter space in a private dataset that we collected in Singapore and a public dataset in R mlogit package. The alternative-specific connectivity constraint, as a domain-knowledge-based regularization method, is more effective than the most popular generic-purpose explicit and implicit regularization methods and architectural hyperparameters. ASU-DNN is also more interpretable because it provides a more regular substitution pattern of travel mode choices than F-DNN does. The comparison between ASU-DNN and F-DNN can also aid in testing the behavioral knowledge. Our results reveal that individuals are more likely to compute utility by using an alternative's own attributes, supporting the long-standing practice in choice modeling. Overall, this study demonstrates that prior behavioral knowledge could be used to guide the architecture design of DNN, to function as an effective domain-knowledge-based regularization method, and to improve both the interpretability and predictive power of DNN in choice analysis.

Date: 2019-09, Revised 2021-04
New Economics Papers: this item is included in nep-big, nep-cmp, nep-sea and nep-upt
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