Consumer willingness to pay for in-flight service and comfort levels: A choice experiment

In the competitive aviation market as a result of the emergence of low cost carriers, charter airlines have had to reconsider their approach to service provision. Specifically, the reduction in service and comfort levels offered by the low cost airlines provides charter carriers with an opportunity to differentiate their product based on the quality of the offering. To consider this strategic option we employ an on-line choice experiment to examine consumer choices with respect to the bundle of services on offer when deciding to purchase a flight. With these data we use the Bayesian methods to estimate a mixed logit specification. Our results reveal that in principle passengers are willing to pay a relatively large amount for enhanced service quality.     

Liberalization,Regulatory Delays and Vulnerability to Systemic Banking Crisis

This work aims at contributing to the improvement of the early warning systems of banking crises using a new approach accounting for model uncertainty. We show that a multinomial logit model based on Bayesian model averaging (BMA) is a good strategy to predict banking crisis. To do this, we argue that differences in vulnerability to banking crisis can be largely explained by an asymmetry between financial market evolution and regulation update on a sample of 49 developed and developing countries between 1980 and 2010. When markets are liberalized, competition pushes bankers to take more risks and take advantage of regulatory delays thus increasing crises probabilities. Our empirical evidence supports that crisis probability is higher in country liberalizing their banking system when regulation is not updated. We developed an early warning system for systemic banking crises based on the multinomial logit model. Its main difference to existing prediction models and its contribution to the literature is that it is intended to identify and resolve what is called by Bussiere and Fratzscher [(2006). Towards a new early warning system of financial crises. Journal of International Money and Finance, 25(6), 953–973] as post-crisis bias in binomial models and to develop a new methodology of leading indicators selection based on BMA. Overall, our model predicts all banking crises during our sample period.     

Effects of income and social awareness on consumer WTP for social product attributes

Recent developments in environmental and animal welfare issues, and the introduction of new production practices may have affected consumer attitudes and preferences toward differentiated product choice. Factors such as animal well-being, environmentally friendly production, and the use of antibiotics appear to be increasingly core consumer concerns. We link the aforementioned with Maslow's hierarchy of needs suggesting that the higher income consumers should be more altruistic in their consumptive behavior and test this by evaluating consumer preferences for these attributes in pork chops. We also test whether social consciousness of the consumers translates into choice behavior. Data was obtained by choice experiment surveys and mixed logit estimation was used to estimate consumers' willingness-to-pay for the credence attributes. Results reveal that both, higher income and socially aware consumers are on average willing to pay higher premiums for the antibiotic-free attribute, but not for other two social attributes. Also, the group of higher income consumers is highly heterogeneous in their preferences, whereas socially aware consumers tend to be more homogeneous in their preferences.     

Determinants of Length of Stay for Domestic Tourists: Case Study of Yixing

The length of stay of a tourist is one of the most important factors indicating consumption levels and revenue generation for certain tourist destinations. This study employs data from a tourist survey in Yixing, China, to investigate potential factors influencing a tourist's length of stay. Applying an ordered logit model, it is found that distance, age, organized tour, transportation, motivation, past visits and assessment of accommodation are some of the major determinants of a tourist's length of stay. The results indicate that traveling distance and the assessment of accommodation are positively associated with the length of stay. In addition, tourists with different modes of transportation, motivations and past visits have different durations of stay. Based on the estimation results from subsamples, it is also found that there are differences in determinants of length of stay between organized tourists and individual tourists, and among different age groups.     

Job preferences of students and new graduates in nursing

This article investigates the preferences of student and newly graduated nurses for pecuniary and nonpecuniary aspects of nursing jobs. It is the first study applying methods based on discrete choice experiments to a developed country nursing workforce. It is also the first to focus on the transition through university training and into work. This is particularly important as junior nurses have the lowest retention levels in the profession. We sample 526 individuals from nursing programmes in two Australian universities. Flexible and newly developed models combining heteroscedasticity with unobserved heterogeneity in scale and preference weights are estimated. Overall, salary remains the most important feature in increasing the probability that a job will be selected. ‘Supportive management/staff’ and ‘quality of care’ follow as the most important attributes from a list of 11 nonpecuniary characteristics. However, the subset of new graduates rank ‘supportive management/staff’ above salary increases, emphasizing the importance of a supportive workplace in the transition from university to the workplace. We find substantial preference heterogeneity and some attributes, such as the opportunity for clinical rotations, are found to be attractive to some nurses while seen as negative by others. Nursing retention could be improved by designing different employment packages to appeal to these different tastes.     

Survival on the Titanic: Illustrating Wald and Lagrange Multiplier Tests for Proportions and Logits

Abstract: Students are interested in lecture examples and class exercises involving data connected to the maiden voyage and the sinking of the liner Titanic. Information on the passengers and their fate can be used to explore relationships between various tests for differences in survival rates between different groups of passengers. Among the concepts the authors examined are tests for differences of proportions using a normal distribution, a chi-square test for independence, a test for the equality of two logits, and a test for the significance of the coefficient of a binary variable in logit model. The authors examined the relationship between Wald and Lagrange Multiplier test statistics and give two related examples.     

The Stability and Instability of Organic Expenditures in Denmark,Great Britain,and Italy

This article concerns demand for organic foods in 3 European countries: Denmark, Great Britain, and Italy. Based on extensive sets of household panel data we categorize households into 4 groups according to their levels of organic consumption. Importance of sociodemographics is estimated by applying multinomial logit models. In all 3 countries a high organic consumption is mainly found among the more well-situated households in urban areas. Although the relative size of the user groups is fairly stable over time, we find variation in the organic consumption of individual households.     

An analysis of crop choice: Adapting to climate change in South American farms

This paper explores how South American farmers adapt to climate by changing crops. We develop a multinomial logit model of farmer's choice of crops. Estimating the model across 949 farmers in seven countries, we find that both temperature and precipitation affect the crops that South American farmers choose. Farmers choose fruits and vegetables in warmer locations and wheat and potatoes in cooler locations. Farms in wetter locations are more likely to grow rice, fruits, potatoes, and squash and in dryer locations maize and wheat. Global warming will cause South American farmers to switch away from maize, wheat, and potatoes towards squash, fruits and vegetables. Predictions of the impact of climate change on net revenue must reflect not only changes in yields per crop but also crop switching.