Maximum score estimates of the determinants of residential mobility: Implications for the value of residential attachment and neighborhood amenities
This paper examines the determinants of the decision of low-income renters to move out of their current dwelling. Maximum score estimation is shown t be superior to ordinary discrete choice estimation techniques (probit, logit) for this problem, ad for similar discrete choices that require revering a previously optimal decision. The estimation reveals psychological costs of moving for typical low income renters of at least 8 percent of their income; these costs are even higher for older, longer tenure, or minority households. Policies that displace low income renters will have large social costs. In addition, the estimation results are used to calculate implicit household willingness to pay (WTP) for neighborhood amenities. This WTP based on mobility behavior is much greater than WTP estimates derived using hedonic methods, and is argued to be more accurate. This paper uses a semiparametric empirical technique to estimate the determinants of the decision of low-income renters to move out of their dwelling. These estimates show that low-income residents highly value remaining in their dwelling. In addition, these estimates are used to illustrate an alternative method to measure willingness to pay for neighborhood amenities. Moving decisions are usually examined with standard discrete choice models such as probit or logit (e.g., Venti and Wise (1984), or Weinberg, Friedman, and Mayo (1981). But the moving decision presents econometric difficulties for standard discrete choice models. As will be explained in section 1, because the household decision about moving is conditional on having previously preferred the original location, the disturbance term in mobility models is unlikely to follow the simple distributional forms required for probit or logit estimation. Maximum score estimation is an alternative estimation technique for discrete choice models that is robust to unusual distributions of the disturbance term. Although the theoretical properties of maximum score e
(This abstract was borrowed from another version of this item.)
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dunn, L. F., 1979. "Measuring the value of community," Journal of Urban Economics, Elsevier, vol. 6(3), pages 371-382, July.
- Bolton, R., 1989. "An Economic Interpretation Of A Sense Of Place," Department of Economics Working Papers 130, Department of Economics, Williams College.
- Manski, Charles F. & Thompson, T. Scott, 1986. "Operational characteristics of maximum score estimation," Journal of Econometrics, Elsevier, vol. 32(1), pages 85-108, June.
- Timothy J. Bartik & V. Kerry Smith, 1996.
"Urban Amenities and Public Policy,"
Book chapters authored by Upjohn Institute researchers,
in: V. Kerry Smith (ed.), Estimating Economic Values for Nature: Methods for Non-Market Valuation, pages 271-318
W.E. Upjohn Institute for Employment Research.
- Dynarski, Mark, 1985. "Housing demand and disequilibrium," Journal of Urban Economics, Elsevier, vol. 17(1), pages 42-57, January.
- Manski, Charles F., 1975. "Maximum score estimation of the stochastic utility model of choice," Journal of Econometrics, Elsevier, vol. 3(3), pages 205-228, August.
- Venti, Steven F. & Wise, David A., 1984.
"Moving and housing expenditure: Transaction costs and disequilibrium,"
Journal of Public Economics,
Elsevier, vol. 23(1-2), pages 207-243.
- Steven F. Venti & David A. Wise, 1982. "Moving and Housing Expenditure: Transaction Costs and Disequilibrium," NBER Working Papers 1012, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:eee:juecon:v:32:y:1992:i:2:p:233-256. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shamier, Wendy)
If references are entirely missing, you can add them using this form.