A fast estimation procedure for discrete choice random coefficients demand model

We document speed-up gains of graphical processing unit (GPU) computing over central processing unit (CPU) for the estimation of discrete choice random coefficient demand model. When we use a moderate-sized GPU, the computation is six to twenty times faster, where the smallest speed-up factor, six, is obtained from a comparison with the parallel computing over sixteen CPU cores.     

The choice of a foreign price measure in a Bayesian estimated new-Keynesian model for Israel

We estimate a small DSGE model by full information Bayesian techniques on the basis of Israeli data from 1995 to 2006. The model was first developed and estimated by means of classical GMM in Argov and Elkayam (2010), and since then it has been used at the Bank of Israel for monetary policy analysis. It is widely believed that in 2007 (out of sample year) as elsewhere worldwide, inflation rose in Israel due to high commodity prices in global markets. However, our baseline model attributes most of the high inflation in 2007 to supply shocks. One conjecture is that this model's result derives from the inappropriate original use of the unit value of imported consumer goods (which do not include unprocessed food and energy) as the main foreign price measure. We test this conjecture by re-estimating the model with various other foreign price measures that typically do reflect the global rise in commodity prices and compare the log-marginal likelihoods. We find that no other price measure outperforms the original choice in the sample period. Only the foreign trade-weighted CPI equals the performance of the original choice while improving the 2007 interpretation of inflation, and should therefore be considered the main foreign price measure. The proposed methodology for comparing the suitability of alternative measures for observable variables can be applied to any model with exogenous variables that are characterized by univariate equations.     

The demand for corporate jets: a discrete choice analysis

Discrete choice analysis is extended into the corporate arena with an analysis of general aviation business jet purchases. Based on previously overlooked data derivable from US aircraft registrations, an estimated model confirms that the business jet market processes information about product attributes similar to household markets for automobiles. Corporate purchasing decisions seem most sensitive to operating efficiencies, interior comfort, and brand loyalty. Price matters, but the average estimated response is inelastic. Other statistically significant attributes with choice elasticities less than one, include aircraft speed and reliability/safety.     

Testing for rationality: the case of discrete choice data

When working with micro data on consumer demand, there are many different situations where decisions involve only discrete choices. In this context, conditions under which an underlying rational preference structure exists are derived. Moreover, by introducing flexibility into the model, it is possible to identify nonrational behavior in the sample.     

An econometric model of tenure choice and demand for housing as a joint decision

This paper models a household's choice of tenure and demand for housing services as a joint decision imposing the restriction that both discrete and continuous decisions are derived from a single preference ordering. The utility index for households is the translog form of the reciprocal indirect utility function allowing for random preferences. Each household chooses between the two main tenures, the owner-occupied and subsidised rental sectors, but households may be rationed in either or both of these sectors and refused admission, in which case they are assumed to enter the third sector, uncontrolled rental. The model is estimated on UK data for 5895 households.     

Periodic and chaotic programs of optimal intertemporal allocation in an aggregative model with wealth effects

Summary We examine a discrete-time aggregative model of discounted dynamic optimization where the felicity function depends on both consumption and capital stock. The need for studying such models has been stressed in the theory of optimal growth and also in the economics of natural resources. We identify conditions under which the optimal program is monotone. In our framework, the optimal program can exhibit cyclic behavior for all discount factors close to one. We also present an example to show that our model can exhibit optimal behavior which is chaotic in both topological and ergodic senses.We would like to thank V. Bala, J. Benhabib, P. Dasgupta, R. Day, L. W. McKenzie, K. Nishimura, S. Roy, and a referee of this journal for comments on earlier versions of this paper. Research support from the National Science Foundation is gratefully acknowledged.     

Bayesian estimation of the output gap for a small open economy: The case of Canada

We introduce a novel approach for estimating output gaps for small open economies. Identification is based on a multivariate trend-cycle decomposition in which transitory exchange rate movements are linked to the output gap and inflation. The model is then applied to Canadian data.     

An experimental comparison of collective choice procedures for excludable public goods

This paper compares three collective choice procedures for the provision of excludable public goods under incomplete information. One, serial cost sharing (SCS), is budget balanced, individually rational, anonymous and strategy proof. The other two are “hybrid” procedures: voluntary cost sharing with proportional rebates (PCS) and with no rebates (NR). PCS satisfies all these properties except strategy proofness, and NR satisfies all the properties except for strategy proofness and budget balance. However, PCS and NR do not exclude any potential users, and they do not require equal cost shares, thereby overcoming the two main sources of inefficiency with SCS. We characterize the Bayesian Nash equilibria (BNE) of the hybrid mechanisms and conduct laboratory experiments to compare the performance of the three mechanisms. We find that PCS produces significantly more efficient allocations than either SCS or NR.     

Patients’ preferences for the treatment of anxiety and depressive disorders: a systematic review of discrete choice experiments

Abstract

Introduction: Matching available mental health services to patients’ preferences, as well as is possible, may increase patient satisfaction and help increase adherence to certain treatments. This study systematically reviewed discrete-choice experiments (DCEs) on patients’ preferences for treatment of depressive and anxiety disorders and assessed the relative importance of outcome, process and cost attributes to improve the current and future treatment situations.

Methods: A systematic literature review using PubMed, EMBASE and PsychInfo was conducted to retrieve all relevant DCEs published up to 15 April 2019, eliciting patient preferences for treatment of depressive and anxiety disorders. Data were extracted using an extraction sheet, and attributes were classified into outcome, process and cost attributes. The relative importance of each attribute category was then assessed, and studies were evaluated according to their reporting quality, using validated checklists.

Results: A total of 11 studies were identified for qualitative analysis. All studies received an aggregate score of 4 on the five-point PREFS checklist (Purpose, Respondents, Explanation, Findings and Significance). Most attributes were outcome related (52%), followed by process (42%) and cost (6%) attributes. Comparing the attribute categories and summing up the relative importance weights for each category within the studies, process attributes were ranked as most important, followed by cost and outcome attributes.

Conclusions: In this systematic review, heterogeneous results were observed regarding the inclusion and framing of different attributes across studies. Overall, patients considered process and cost attributes to be more important than outcome attributes. Outcomes and process are important for patients, and thus clinicians should be particularly aware of this and take patients’ preferences into account, although the attribute importance may depend on chosen attributes and related levels.     

Marketing an upgrade to a system: compatibility choice as a price discrimination device

This paper analyzes the different ways in which an innovator can market an upgrade for a basic system when the market for this system is mature and there are two different technological platforms: the innovator’s and a rival’s. Different compatibility choices result in different product lines and yield varying price discrimination opportunities. The paper studies what are the limits to the enforcement of these opportunities and concludes by showing what is the profit maximizing product line choice when consumers are brand loyal. This choice depends on the initial market share of the innovator and on the enhancement of quality that the upgrade provides.     

RASAT,a model for the estimation of commodity trade flows in EFTA

The RAS method of updating a trade flow matrix is extended into the third dimension of commodity trade. The model is used to update the 1959 trade flows to 1965 for the EFTA countries. Measures are then derived to estimate trade diversion within EFTA. These estimates are contrasted with other ex-post estimates, and are further used to examine the accuracy of the predictions of trade diversion from a simple elasticity of demand model.     

On uniqueness of the conditional maximum likelihood estimation for a binary panel model

This paper considers an estimation method for a binary panel model with incidental parameters as individual effects. The necessary condition for the conditional maximum likelihood approach proposed by Andersen (1970) is investigated and we show that unique sufficient statistics exist only for logit models in a two-wave panel.     

On-the-job human capital accumulation in a real business cycle model: Implications for intertemporal substitution elasticity and labor hoarding

A substantial fraction of a worker's time at work goes to acquiring human capital. This paper explicitly considers on-the-job human capital accumulation from the perspective of time invested for acquiring skills and learning by doing in an RBC model and shows that the inability to account for human capital accumulation leads to a substantial bias in conventional estimates of intertemporal substitution elasticity.Our main results are based on the standard intuition that the opportunity cost of time invested in acquiring human capital moves procyclically, so that on-the-job time invested in acquiring human capital is “counter-cyclical.” Furthermore, the true wage rate becomes less procyclical, while production hours become more procyclical than total hours at work. The overall results can be viewed as providing a micro foundation for labor hoarding models without adjustment costs.     

Parameter estimation of an asset price model driven by a weak hidden Markov chain

We introduce a weak hidden Markov model (WHMM) in an attempt to capture more accurately the evolution of a risky asset. The log returns of assets are modulated by a weak or higher-order Markov chain with finite-state space. In particular, the optimal estimates of the second-order Markov chain and parameters of the model are given in terms of the discrete-time filters for the state of the Markov chain, the number of jumps, occupation time and auxiliary processes. We provide a detailed implementation of the model to a dataset of financial time series along with the analysis of the h-day ahead forecasts. The results of our error analysis suggest that within the dataset studied and considering longer predictive horizons, WHMM gives a better forecasting performance than the traditional HMM.     

Nonparametric estimation of a dependent competing risks model for unemployment durations

In this paper we simultaneously analyze transitions from unemployment to employment and to nonparticipation. We estimate a dependent competing risks model with nonparametric specifications of the destination-specific duration dependence and unobserved heterogeneity terms, allowing for mutual dependence of the unobserved heterogeneity terms. We use an administrative data set covering all registered French unemployed over the period 1988–1994, stratified by gender type, duration class and exit state. We thank the Editor and three anonymous referees for their useful comments. A preliminary version of this paper was distributed under the title “Individual variation in exit rates from unemployment: a nonparametric multivariate analysis using aggregate data”. The Département de Marché du Travail of the Ministère du Travail, de l’Emploi et de la Formation Professionelle of France kindly provided the data.     

TV viewing: application of a formal choice model

Choices of television programs is viewed as a process of deciding among a set of alternative goods with zero prices. A choice model can thus be based purely on individuals' preferences for various characteristics of a set of shows available, incorporating the option of not watching if all shows are too dissimilar to these desires. The shows are first grouped according to salient characteristics and a preferred value for each characteristic is estimated for each potential viewer. A perceived position of each show is similarly estimated and watching is shown to decline as similarity between preferred show and available alternatives declines. The choice model predicts show choice better than simpler models based on aggregate audience measures or on network loyalty, but the explanatory power is weak; some suggestions for improvement are made.     

Modelling preference heterogeneity for theatre tickets: a discrete choice modelling approach on Royal Danish Theatre booking data

This article analyses the behavioural choice for theatre tickets using a rich data set for 2010–2013 from the sale system of the Royal Danish National Theatre. A consumer who decides to attend a theatre production faces multiple sources of price variation that involves a choice by the consumer among different ticket alternatives. Three modelling approaches are proposed in order to model ticket purchases: conditional logit with socio-demographic characteristics, nested logit and latent class. These models allow us explicitly to take into account consumers’ preference heterogeneity with respect to the attributes associated with each ticket alternative (quality of the seat and day of the performance). In addition, the willingness to pay of choice attributes is estimated. Final results suggest that customers’ characteristics in terms of age and frequency of theatre attendance characterize different patterns of behaviour in the choice of theatre ticket.     

The discrete time version of the Romer model

Summary. This paper presents a discrete time version of the Romer 1986 model of endogenous growth. The purpose of this work is to propose detailed and simple proofs of existence of optimal solutions and of a competitive equilibrium. The framework implemented here reduces the complexity of the proofs given by Romer (1983) in his Ph.D dissertation in a continuous time framework. Received: March 7, 2000; revised version: April 25, 2001     

Practical guidelines for the estimation and inference of a dynamic logistic model with fixed-effects

This paper shows how to simply compute one of the estimators proposed by Honoré and Kyriazidou (2000), as well as its variance, through a reshaping of the original dataset that is then used in a weighted logistic regression with clustering.