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A non-compensatory choice model incorporating attribute cutoffs

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  • Swait, Joffre

Abstract

This research proposes an extension to the traditional compensatory utility maximization framework which has guided most theoretical and statistical work in choice modeling applications, including those in transportation demand estimation work. Attribute cutoffs are incorporated into the decision problem formulation; it is then argued on extant empirical evidence that individuals may view these constraints as "soft". This leads to the formulation of a penalized utility function that allows for constraint violation, but at a cost to the overall evaluation of the good. The proposed model is able to represent fully compensatory, conjunctive and disjunctive choice strategies, as well as combinations thereof. The properties of the proposed theoretical model are examined and discussed. From the theoretical framework, statistical models of choice behavior are easily derived; in their simplest forms, these models can be estimated using existing software. A Stated Preference choice experiment is analyzed using the proposed model, which is found to be highly consistent with observed choices and superior to a structural two-stage choice set formation model.

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Bibliographic Info

Article provided by Elsevier in its journal Transportation Research Part B: Methodological.

Volume (Year): 35 (2001)
Issue (Month): 10 (November)
Pages: 903-928

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Handle: RePEc:eee:transb:v:35:y:2001:i:10:p:903-928

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  1. Pollak, R.A. & Wales, T.J., 1990. "The Likelihood Dominance Criterion: A New Approach To Model Selection," Discussion Papers in Economics at the University of Washington 90-10, Department of Economics at the University of Washington.
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  3. Lohse, Gerald L. & Johnson, Eric J., 1996. "A Comparison of Two Process Tracing Methods for Choice Tasks," Organizational Behavior and Human Decision Processes, Elsevier, vol. 68(1), pages 28-43, October.
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  5. Ford, J. Kevin & Schmitt, Neal & Schechtman, Susan L. & Hults, Brian M. & Doherty, Mary L., 1989. "Process tracing methods: Contributions, problems, and neglected research questions," Organizational Behavior and Human Decision Processes, Elsevier, vol. 43(1), pages 75-117, February.
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  9. Swait, Joffre & Ben-Akiva, Moshe, 1987. "Empirical test of a constrained choice discrete model: Mode choice in São Paulo, Brazil," Transportation Research Part B: Methodological, Elsevier, vol. 21(2), pages 103-115, April.
  10. Huber, Joel & Klein, Noreen M, 1991. " Adapting Cutoffs to the Choice Environment: The Effects of Attribute Correlation and Reliability," Journal of Consumer Research, University of Chicago Press, vol. 18(3), pages 346-57, December.
  11. Brownstone, David & Train, Kenneth, 1998. "Forecasting new product penetration with flexible substitution patterns," Journal of Econometrics, Elsevier, vol. 89(1-2), pages 109-129, November.
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