Identification With Additively Separable Heterogeneity

Econometrica ◽  
2019 ◽  
Vol 87 (3) ◽  
pp. 1021-1054 ◽  
Author(s):  
Roy Allen ◽  
John Rehbeck
Keyword(s):  
Discrete Choice ◽  
Nonparametric Identification ◽  
Indirect Utility ◽  
Independence Assumption ◽  
Representative Agent ◽  
Decisions Under Uncertainty ◽  
Utility Models ◽  
Latent Utility ◽  
Unobservable Heterogeneity

This paper provides nonparametric identification results for a class of latent utility models with additively separable unobservable heterogeneity. These results apply to existing models of discrete choice, bundles, decisions under uncertainty, and matching. Under an independence assumption, such models admit a representative agent. As a result, we can identify how regressors alter the desirability of goods using only average demands. Moreover, average indirect utility (“welfare”) is identified without needing to specify or identify the distribution of unobservable heterogeneity.

Constructing Indirect Utility Models: Some Observations on the Principles and Practice of Mapping to Obtain Health State Utilities

2013 ◽  
Vol 31 (8) ◽  
pp. 635-641 ◽  
Author(s):  
Christopher McCabe ◽  
Richard Edlin ◽  
David Meads ◽  
Chantelle Brown ◽  
Samer Kharroubi
Keyword(s):  
Health State ◽  
Indirect Utility ◽  
Utility Models ◽  
Health State Utilities

scholarly journals Discrete Choice Prox-Functions on the Simplex

2021 ◽  
Author(s):  
David Müller ◽  
Yurii Nesterov ◽  
Vladimir Shikhman
Keyword(s):  
Discrete Choice ◽  
Nested Logit ◽  
Random Utility ◽  
Consumer Theory ◽  
Logit Models ◽  
Random Utility Models ◽  
Economic Application ◽  
Utility Models ◽  
Convexity Parameter ◽  
Dual Averaging

We derive new prox-functions on the simplex from additive random utility models of discrete choice. They are convex conjugates of the corresponding surplus functions. In particular, we explicitly derive the convexity parameter of discrete choice prox-functions associated with generalized extreme value models, and specifically with generalized nested logit models. Incorporated into subgradient schemes, discrete choice prox-functions lead to a probabilistic interpretations of the iteration steps. As illustration, we discuss an economic application of discrete choice prox-functions in consumer theory. The dual averaging scheme from convex programming adjusts demand within a consumption cycle.

scholarly journals The impact of mobile payment on payment choice

2016 ◽  
Vol 30 (3) ◽  
pp. 299-336 ◽  
Author(s):  
Tobias Trütsch
Keyword(s):  
Discrete Choice ◽  
The United States ◽  
Mobile Payment ◽  
Random Utility ◽  
Welfare Gains ◽  
Private Industry ◽  
Point Of Sale ◽  
Payment Instruments ◽  
Utility Models ◽  
The Impact

Abstract This paper investigates the effect of mobile payment on the adoption and use of traditional payment instruments such as cash, checks, and credit, debit and prepaid cards at the point of sale (POS). Data are from a 2012 representative survey on consumer payment choice in the United States. Using discrete-choice random utility models to simulate consumer behavior, the estimation provides two major findings. First, mobile payment does not replace physical payment cards, but is likely to substitute for paper-based payment methods such as cash and checks at the adoption stage. Second, mobile payment does not statistically significantly influence the choice of payment means at the POS in terms of usage. However, there is suggestive evidence that it is complementary to card payments and a substitute for paper-based payment instruments. The findings highlight the potential social welfare gains of mobile payment and provide key insights into challenging issues for the private industry sector. This paper furthermore offers novel evidence on the impact of mobile payment on the use and adoption of existing payment instruments and contributes to the literature on consumer payment choice.

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