IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

Income, Time Effects and Direct Preferences in a Multimodal Choice Context: Application of Mixed RP/SP Models with Non-Linear Utilities

Listed author(s):
  • Elisabetta Cherchi


  • Juan Ortúzar


Registered author(s):

    Transport problems typically involve at least two types of constraints, on income and on time. Therefore, the indirect utility function depends either on the income available after having subtracted the cost of the discrete alternative and on the free time left after having worked and travelled by each competing option. In the typical linear-in-the-attributes and in-the-parameters specification, that represents the first grade approximation of the indirect utility function, the effect of income and time constraints cancel out and only the cost and time of the alternatives matter in the comparison between them. From a microeconomic point of view this is equivalent to assume that income and time effects could be disregarded; which is not always the case. To account for these effects the utility function should include second order attributes; however, in non-linear utility functions it may not be easy to distinguish among several effects that could be relevant: direct preferences for good and leisure, and simple interactions between attributes other than income and time effects. This paper analyses these effects from a theoretical point of view focusing on the possible confounding problem in detecting income and time effects. We use a dataset collected for a modal choice context and containing both revealed and stated preference data, and estimate several NL models examining the effect of the different second-order terms on detecting income and time effects. We compared specifications including square cost and time attributes, interactions between time and cost, cost divided by the income available to be spent on free time, and time multiplied by free time. Our results confirm the strong effect of direct preferences for goods and leisure time on choice, and the potential confounding effect between quadratic attributes and other non-linear omitted terms. Finally, we also found that care should be taken in highlighting income and time effects using mixed data sources, since confounding effects can occur when non-linearities are accounted for in both data sets. Copyright Springer Science + Business Media, LLC 2006

    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.

    File URL:
    Download Restriction: Access to full text is restricted to subscribers.

    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.

    Article provided by Springer in its journal Networks and Spatial Economics.

    Volume (Year): 6 (2006)
    Issue (Month): 1 (March)
    Pages: 7-23

    in new window

    Handle: RePEc:kap:netspa:v:6:y:2006:i:1:p:7-23
    DOI: 10.1007/s11067-006-7682-7
    Contact details of provider: Web page:

    Order Information: Web:

    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.:

    in new window

    1. Leclerc, France & Schmitt, Bernd H & Dube, Laurette, 1995. " Waiting Time and Decision Making: Is Time like Money?," Journal of Consumer Research, Oxford University Press, vol. 22(1), pages 110-119, June.
    2. Louviere,Jordan J. & Hensher,David A. & Swait,Joffre D., 2000. "Stated Choice Methods," Cambridge Books, Cambridge University Press, number 9780521788304, December.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:kap:netspa:v:6:y:2006:i:1:p:7-23. 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: (Sonal Shukla)

    or (Rebekah McClure)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.