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An exploratory analysis of the effect of numbers of choice sets in designed choice experiments: an airline choice application

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  • Hensher, David A.
  • Stopher, Peter R.
  • Louviere, Jordan J.

Abstract

Stated choice (SC) experiments are increasingly adopted as the empirical source of information on how individuals respond to current and potential travel contexts. The accumulated experience with SC data has been heavily conditioned on analyst prejudices about the acceptable complexity of the data collection instrument, especially the number of profiles (or treatments) given to each sampled individual (and the number of attributes and alternatives to be processed). It is not uncommon for analysts to impose very stringent limitations on the complexity of an SC experiment. A review of the literature suggests that very little is known about the basis for rejecting complex designs or accepting simple designs. In this paper, we develop a complex design as the basis for an SC study, producing a fractional factorial of 32 rows. However, we then truncate the fraction by administering 4, 8, 16, 24 and 32 profiles to a sample of individuals in Australia and New Zealand faced with the decision to fly (or not to fly) between Australia and New Zealand by alternative airlines and fare regimes. Statistical comparisons of elasticities (an appropriate behavioural basis for comparisons) suggest that the empirical gains within the context of a linear specification of the utility expression associated with each alternative in a discrete choice model may be quite marginal.

Suggested Citation

  • Hensher, David A. & Stopher, Peter R. & Louviere, Jordan J., 2001. "An exploratory analysis of the effect of numbers of choice sets in designed choice experiments: an airline choice application," Journal of Air Transport Management, Elsevier, vol. 7(6), pages 373-379.
  • Handle: RePEc:eee:jaitra:v:7:y:2001:i:6:p:373-379 DOI: 10.1016/S0969-6997(01)00031-X
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    References listed on IDEAS

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    1. Lian, Jon Inge & Denstadli, Jon Martin, 2004. "Norwegian business air travel–segments and trends," Journal of Air Transport Management, Elsevier, pages 109-118.
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    Cited by:

    1. Carlsson, Fredrik & Martinsson, Peter, 2008. "Does it matter when a power outage occurs? -- A choice experiment study on the willingness to pay to avoid power outages," Energy Economics, Elsevier, pages 1232-1245.
    2. Johnson, F. Reed & Ozdemir, Semra & Phillips, Kathryn A., 2010. "Effects of simplifying choice tasks on estimates of taste heterogeneity in stated-choice surveys," Social Science & Medicine, Elsevier, pages 183-190.
    3. Bruno Lanz & Allan Provins, 2015. "Using discrete choice experiments to regulate the provision of water services: do status quo choices reflect preferences?," Journal of Regulatory Economics, Springer, pages 300-324.
    4. Riccardo Scarpa & John M. Rose, 2008. "Design efficiency for non-market valuation with choice modelling: how to measure it, what to report and why ," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, pages 253-282.
    5. Jürgen Meyerhoff & Malte Oehlmann & Priska Weller, 2015. "The Influence of Design Dimensions on Stated Choices in an Environmental Context," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, pages 385-407.
    6. Ek, Kristina & Persson, Lars, 2014. "Wind farms — Where and how to place them? A choice experiment approach to measure consumer preferences for characteristics of wind farm establishments in Sweden," Ecological Economics, Elsevier, vol. 105(C), pages 193-203.
    7. Hu, Wuyang & Adamowicz, Wiktor L. & Veeman, Michele M., 2004. "Decomposing Unobserved Choice Variability In The Presence Of Consumers' Taste Heterogeneity," 2004 Annual meeting, August 1-4, Denver, CO 19954, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    8. Yang, Jui-Chen & Johnson, F. Reed & Kilambi, Vikram & Mohamed, Ateesha F., 2015. "Sample size and utility-difference precision in discrete-choice experiments: A meta-simulation approach," Journal of choice modelling, Elsevier, vol. 16(C), pages 50-57.
    9. repec:eee:transa:v:103:y:2017:i:c:p:455-471 is not listed on IDEAS
    10. Mandy Ryan & Mabelle Amaya-Amaya, 2005. "' Threats ' to and hopes for estimating benefits," Health Economics, John Wiley & Sons, Ltd., vol. 14(6), pages 609-619.
    11. Nocella, Giuseppe & Stefani, Gianluca & Romano, Donato, 2011. "Preferences, trust and willingness to pay for food information: An analysis of the Italian Market," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114606, European Association of Agricultural Economists.
    12. Forbes-Brown, Shelicia & Mcheels, Eric & Hobbs, Jill, 2015. "Signalling Origin: Consumer Willngness to Pay for Dairy Products with the "100% Canadian Milk" Label," 2015 Conference, August 9-14, 2015, Milan, Italy 211636, International Association of Agricultural Economists.
    13. Rose, John M. & Hensher, David A. & Greene, William H., 2005. "Recovering costs through price and service differentiation: Accounting for exogenous information on attribute processing strategies in airline choice," Journal of Air Transport Management, Elsevier, pages 400-407.
    14. repec:eee:transa:v:103:y:2017:i:c:p:198-210 is not listed on IDEAS
    15. Mau, Paulus & Eyzaguirre, Jimena & Jaccard, Mark & Collins-Dodd, Colleen & Tiedemann, Kenneth, 2008. "The 'neighbor effect': Simulating dynamics in consumer preferences for new vehicle technologies," Ecological Economics, Elsevier, vol. 68(1-2), pages 504-516, December.
    16. Athanasios Krystallis & Michalis Linardakis & Spyridon Mamalis, 2010. "Usefulness of the discrete choice methodology for marketing decision-making in new product development: an example from the European functional foods market," Agribusiness, John Wiley & Sons, Ltd., vol. 26(1), pages 100-121.
    17. Bart Neuts & Peter Nijkamp & Eveline van Leeuwen, 2013. "Crowding Externalities from Tourist Use of Urban Space," Tinbergen Institute Discussion Papers 13-146/VIII, Tinbergen Institute.
    18. repec:eee:touman:v:33:y:2012:i:5:p:1174-1184 is not listed on IDEAS
    19. Andrew Collins & John Rose & Stephane Hess, 2012. "Interactive stated choice surveys: a study of air travel behaviour," Transportation, Springer, pages 55-79.
    20. Marit E. Kragt & Jeff Bennett, 2008. "Developing a Questionnaire for Valuing Changes in Natural Resource Management in the George Catchment, Tasmania," Environmental Economics Research Hub Research Reports 0808, Environmental Economics Research Hub, Crawford School of Public Policy, The Australian National University.
    21. Carlsson, Fredrik & Martinsson, Peter, 2006. "How much is too much? - An investigation of the effect of the number of choice sets, starting point and the choice of bid vectors in choice experiments," Working Papers in Economics 191, University of Gothenburg, Department of Economics.
    22. Achtnicht, Martin, 2011. "Do environmental benefits matter? Evidence from a choice experiment among house owners in Germany," Ecological Economics, Elsevier, vol. 70(11), pages 2191-2200, September.
    23. Mandy Ryan & Karen Gerard & Gillian Currie, 2012. "Using Discrete Choice Experiments in Health Economics," Chapters,in: The Elgar Companion to Health Economics, Second Edition, chapter 41 Edward Elgar Publishing.
    24. Escobari, Diego, 2017. "Airport, airline and departure time choice and substitution patterns: An empirical analysis," Transportation Research Part A: Policy and Practice, Elsevier, vol. 103(C), pages 198-210.
    25. Vecchiato, D. & Tempesta, T., 2013. "Valuing the benefits of an afforestation project in a peri-urban area with choice experiments," Forest Policy and Economics, Elsevier, vol. 26(C), pages 111-120.

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