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Statistical Properties of Consideration Sets

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  • Carson, Richard T.
  • Louviere, Jordan J.

Abstract

Consideration sets have become a central concept in the study of consumer behavior. Frequently, consumers are asked to split choice alternatives into those that that they would consider and those that they would not. Information on alternatives not in the consideration set is then typically not used in subsequent analysis. This practice is shown to lead to biased estimates of preference parameters. The reason for this is shown to be a form of sample selection bias.

Suggested Citation

  • Carson, Richard T. & Louviere, Jordan J., 2006. "Statistical Properties of Consideration Sets," University of California at San Diego, Economics Working Paper Series qt9qt9g4p4, Department of Economics, UC San Diego.
    • Handle: RePEc:cdl:ucsdec:qt9qt9g4p4
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    Citations

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    Cited by:

    1. Didier Nibbering, 2023. "A High-dimensional Multinomial Logit Model," Monash Econometrics and Business Statistics Working Papers 19/23, Monash University, Department of Econometrics and Business Statistics.
    2. Reinhard A. Weisser, 2020. "How Personality Shapes Study Location Choices," Research in Higher Education, Springer;Association for Institutional Research, vol. 61(1), pages 88-116, February.
    3. Stafford, Tess M., 2018. "Accounting for outside options in discrete choice models: An application to commercial fishing effort," Journal of Environmental Economics and Management, Elsevier, vol. 88(C), pages 159-179.
    4. Nibbering, Didier & Hastie, Trevor J., 2022. "Multiclass-penalized logistic regression," Computational Statistics & Data Analysis, Elsevier, vol. 169(C).
    5. Edenbrandt, Anna Kristina & Lagerkvist, Carl-Johan & Lüken, Malte & Orquin, Jacob L., 2022. "Seen but not considered? Awareness and consideration in choice analysis," Journal of choice modelling, Elsevier, vol. 45(C).
    6. Denzil G. Fiebig & Rosalie Viney & Stephanie Knox & Marion Haas & Deborah J. Street & Arne R. Hole & Edith Weisberg & Deborah Bateson, 2017. "Consideration Sets and Their Role in Modelling Doctor Recommendations About Contraceptives," Health Economics, John Wiley & Sons, Ltd., vol. 26(1), pages 54-73, January.

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    More about this item

    Keywords

    choice models; random utility; sample selection bias;
    All these keywords.

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing
    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions

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