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Modelling Heterogeneity in Response Behaviour Towards a Sequence of Discrete Choice Questions: A Probabilistic Decision Process Model

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  • Ben McNair
  • David Hensher
  • Jeff Bennett

Abstract

There is a growing body of evidence in the non-market valuation literature suggesting that responses to a sequence of discrete choice questions tend to violate the assumptions typically made by analysts regarding independence of responses and stability of preferences. Decision processes (or heuristics) such as value learning and strategic misrepresentation have been offered as explanations for these results. While a few studies have tested these heuristics as competing hypotheses, none has investigated the possibility that each explains the response behaviour of a subgroup of the population. In this paper, we make a contribution towards addressing this research gap by presenting a probabilistic decision process model designed to estimate the proportion of respondents employing defined heuristics. We demonstrate the model on binary and multinomial choice data sources and find three distinct types of response behaviour. The results suggest that accounting for heterogeneity in response behaviour may be a better way forward than attempting to identify a single heuristic to explain the behaviour of all respondents.
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  • Ben McNair & David Hensher & Jeff Bennett, 2012. "Modelling Heterogeneity in Response Behaviour Towards a Sequence of Discrete Choice Questions: A Probabilistic Decision Process Model," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 51(4), pages 599-616, April.
  • Handle: RePEc:kap:enreec:v:51:y:2012:i:4:p:599-616
    DOI: 10.1007/s10640-011-9514-6
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    Cited by:

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    2. Mandy Ryan & Nicolas Krucien & Frouke Hermens, 2018. "The eyes have it: Using eye tracking to inform information processing strategies in multi‐attributes choices," Health Economics, John Wiley & Sons, Ltd., vol. 27(4), pages 709-721, April.
    3. Gonzalez-Valdes, Felipe & Raveau, Sebastián, 2018. "Identifying the presence of heterogeneous discrete choice heuristics at an individual level," Journal of choice modelling, Elsevier, vol. 28(C), pages 28-40.
    4. Balbontin, Camila & Hensher, David A. & Collins, Andrew T., 2017. "Is there a systematic relationship between random parameters and process heuristics?," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 106(C), pages 160-177.
    5. Wiktor L. Adamowicz & Klaus Glenk & Jürgen Meyerhoff, 2014. "Choice modelling research in environmental and resource economics," Chapters, in: Stephane Hess & Andrew Daly (ed.), Handbook of Choice Modelling, chapter 27, pages 661-674, Edward Elgar Publishing.
    6. Kazagli, Evanthia & de Lapparent, Matthieu, 2023. "A discrete choice modeling framework of heterogenous decision rules accounting for non-trading behavior," Journal of choice modelling, Elsevier, vol. 48(C).
    7. Hancock, Thomas O. & Hess, Stephane & Marley, A.A.J. & Choudhury, Charisma F., 2021. "An accumulation of preference: Two alternative dynamic models for understanding transport choices," Transportation Research Part B: Methodological, Elsevier, vol. 149(C), pages 250-282.
    8. Anna Bartczak & Jürgen Meyerhoff, 2012. "Valuing the chances of survival of two distinct Eurasian lynx populations in Poland – do people want to keep doors open?," Working Papers 2012-14, Faculty of Economic Sciences, University of Warsaw.
    9. Balbontin, Camila & Hensher, David A. & Collins, Andrew T., 2017. "Integrating attribute non-attendance and value learning with risk attitudes and perceptual conditioning," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 97(C), pages 172-191.
    10. Daniel R. Petrolia & Matthew G. Interis & Joonghyun Hwang, 2018. "Single-Choice, Repeated-Choice, and Best-Worst Scaling Elicitation Formats: Do Results Differ and by How Much?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 69(2), pages 365-393, February.
    11. Hensher, David A. & Balbontin, Camila & Collins, Andrew T., 2018. "Heterogeneity in decision processes: Embedding extremeness aversion, risk attitude and perceptual conditioning in multiple process rules choice making," Transportation Research Part A: Policy and Practice, Elsevier, vol. 111(C), pages 316-325.
    12. David Hensher & Andrew Collins & William Greene, 2013. "Accounting for attribute non-attendance and common-metric aggregation in a probabilistic decision process mixed multinomial logit model: a warning on potential confounding," Transportation, Springer, vol. 40(5), pages 1003-1020, September.
    13. Thiene, Mara & Meyerhoff, Jürgen & De Salvo, Maria, 2012. "Scale and taste heterogeneity for forest biodiversity: Models of serial nonparticipation and their effects," Journal of Forest Economics, Elsevier, vol. 18(4), pages 355-369.
    14. Leong, Waiyan & Hensher, David A., 2012. "Embedding multiple heuristics into choice models: An exploratory analysis," Journal of choice modelling, Elsevier, vol. 5(3), pages 131-144.
    15. David Hensher, 2014. "Attribute processing as a behavioural strategy in choice making," Chapters, in: Stephane Hess & Andrew Daly (ed.), Handbook of Choice Modelling, chapter 12, pages 268-289, Edward Elgar Publishing.
    16. Balbontin, Camila & Hensher, David A. & Collins, Andrew T., 2019. "How to better represent preferences in choice models: The contributions to preference heterogeneity attributable to the presence of process heterogeneity," Transportation Research Part B: Methodological, Elsevier, vol. 122(C), pages 218-248.
    17. Campbell, Danny & Boeri, Marco & Doherty, Edel & George Hutchinson, W., 2015. "Learning, fatigue and preference formation in discrete choice experiments," Journal of Economic Behavior & Organization, Elsevier, vol. 119(C), pages 345-363.
    18. Gonzalez-Valdes, Felipe & Heydecker, Benjamin G. & Ortúzar, Juan de Dios, 2022. "Quantifying behavioural difference in latent class models to assess empirical identifiability: Analytical development and application to multiple heuristics," Journal of choice modelling, Elsevier, vol. 43(C).

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    More about this item

    Keywords

    Choice experiment; Decision process; Ordering effects; Strategic response; Willingness to pay; C25; L94; Q51;
    All these keywords.

    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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