IDEAS home Printed from https://ideas.repec.org/a/kap/transp/v41y2014i4p745-763.html
   My bibliography  Save this article

Heterogeneity assumptions in the specification of bargaining models: a study of household level trade-offs between commuting time and salary

Author

Listed:
  • Vikki O’Neill
  • Stephane Hess

Abstract

With many real world decisions being made in conjunction with other decision makers, or single agent decisions having an influence on other members of the decision maker’s immediate entourage, there is strong interest in studying the relative weight assigned to different agents in such contexts. In the present paper, we focus on the case of one member of a two person household being asked to make choices affecting the travel time and salary of both members. We highlight the presence of significant heterogeneity across individuals not just in their underlying sensitivities, but also in the relative weight they assign to their partner, and show how this weight varies across attributes. This is in contrast to existing work which uses weights assigned to individual agents at the level of the overall utility rather than for individual attributes. We also show clear evidence of a risk of confounding between heterogeneity in marginal sensitivities and heterogeneity in the weights assigned to each member. We show how this can lead to misleading model results, and argue that this may also explain past results showing bargaining or weight parameters outside the usual [0,1] range in more traditional joint decision making contexts. In terms of substantive results, we find that male respondents place more weight on their partner’s travel time, while female respondents place more weight on their partner’s salary. Copyright Springer Science+Business Media New York 2014

Suggested Citation

  • Vikki O’Neill & Stephane Hess, 2014. "Heterogeneity assumptions in the specification of bargaining models: a study of household level trade-offs between commuting time and salary," Transportation, Springer, vol. 41(4), pages 745-763, July.
  • Handle: RePEc:kap:transp:v:41:y:2014:i:4:p:745-763
    DOI: 10.1007/s11116-013-9483-4
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s11116-013-9483-4
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1007/s11116-013-9483-4?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Alistair Munro, 2009. "Introduction to the Special Issue: Things We Do and Don’t Understand About the Household and the Environment," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 43(1), pages 1-10, May.
    2. M. Browning & P. A. Chiappori, 1998. "Efficient Intra-Household Allocations: A General Characterization and Empirical Tests," Econometrica, Econometric Society, vol. 66(6), pages 1241-1278, November.
    3. Frederic Vermeulen, 2002. "Collective Household Models: Principles and Main Results," Journal of Economic Surveys, Wiley Blackwell, vol. 16(4), pages 533-564, September.
    4. Donna Dosman & Wiktor Adamowicz, 2006. "Combining Stated and Revealed Preference Data to Construct an Empirical Examination of Intrahousehold Bargaining," Review of Economics of the Household, Springer, vol. 4(1), pages 15-34, March.
    5. Rao, Vithala R & Steckel, Joel H, 1991. "A Polarization Model for Describing Group Preferences," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 18(1), pages 108-118, June.
    6. Caussade, Sebastián & Ortúzar, Juan de Dios & Rizzi, Luis I. & Hensher, David A., 2005. "Assessing the influence of design dimensions on stated choice experiment estimates," Transportation Research Part B: Methodological, Elsevier, vol. 39(7), pages 621-640, August.
    7. Dellaert, B.G.C. & Prodigalidad, M. & Louviere, J.J., 1997. "Family members' projection of each other's preference and influence : a two-stage conjoint approach," Discussion Paper 1997-93, Tilburg University, Center for Economic Research.
    8. repec:bla:jecsur:v:16:y:2002:i:4:p:533-64 is not listed on IDEAS
    9. Swärdh, Jan-Erik & Algers, Staffan, 2009. "Willingness to accept commuting time for yourself and for your spouse: Empirical evidence from Swedish stated preference data," Working Papers 2009:5, Swedish National Road & Transport Research Institute (VTI).
    10. Elizabeth Katz, 1997. "The Intra-Household Economics of Voice and Exit," Feminist Economics, Taylor & Francis Journals, vol. 3(3), pages 25-46.
    11. Nesha Beharry-Borg & David Hensher & Riccardo Scarpa, 2009. "An Analytical Framework for Joint vs Separate Decisions by Couples in Choice Experiments: The Case of Coastal Water Quality in Tobago," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 43(1), pages 95-117, May.
    12. Dellaert, B.G.C. & Prodigalidad, M. & Louviere, J.J., 1997. "Family members' projection of each other's preference and influence : a two-stage conjoint approach," Other publications TiSEM c5277e3b-fd03-47d3-84b0-3, Tilburg University, School of Economics and Management.
    13. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521747387, September.
    14. Ian Bateman & Alistair Munro, 2005. "An Experiment on Risky Choice Amongst Households," Economic Journal, Royal Economic Society, vol. 115(502), pages 176-189, March.
    15. Lampietti, Julian, 1999. "Do husbands and wives make the same choices? Evidence from Northern Ethiopia," Economics Letters, Elsevier, vol. 62(2), pages 253-260, February.
    16. David A. Hensher & John M. Rose & Ian Black, 2008. "Interactive Agency Choice in Automobile Purchase Decisions: The Role of Negotiation in Determining Equilibrium Choice Outcomes," Journal of Transport Economics and Policy, University of Bath, vol. 42(2), pages 269-296, May.
    17. Wiktor Adamowicz & Michel Hanemann & Joffre Swait & Reed Johnson & David Layton & Michel Regenwetter & Torsten Reimer & Robert Sorkin, 2005. "Decision Strategy and Structure in Households: A “Groups” Perspective," Marketing Letters, Springer, vol. 16(3), pages 387-399, December.
    18. Hess, Stephane & Bierlaire, Michel & Polak, John W., 2005. "Estimation of value of travel-time savings using mixed logit models," Transportation Research Part A: Policy and Practice, Elsevier, vol. 39(2-3), pages 221-236.
    19. Andrew Daly & Stephane Hess & Kenneth Train, 2012. "Assuring finite moments for willingness to pay in random coefficient models," Transportation, Springer, vol. 39(1), pages 19-31, January.
    20. Edoardo Marcucci & Amanda Stathopoulos & Lucia Rotaris & Romeo Danielis, 2011. "Comparing Single and Joint Preferences: A Choice Experiment on Residential Location in Three-Member Households," Environment and Planning A, , vol. 43(5), pages 1209-1225, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mariel, Petr & Meyerhoff, Jürgen, 2018. "A More Flexible Model or Simply More Effort? On the Use of Correlated Random Parameters in Applied Choice Studies," Ecological Economics, Elsevier, vol. 154(C), pages 419-429.
    2. Boto-García, David & Mariel, Petr & Baños-Pino, José Francisco, 2023. "Intra-household bargaining for a joint vacation," Journal of choice modelling, Elsevier, vol. 47(C).
    3. Mariel, Petr & Scarpa, Riccardo & Vega-Bayo, Ainhoa, 2018. "Joint parental school choice: Exploring the influence of individual preferences of husbands and wives," Regional Science and Urban Economics, Elsevier, vol. 68(C), pages 23-35.
    4. Ho, Chinh Q. & Mulley, Corinne & Shiftan, Yoram & Hensher, David A., 2016. "Vehicle value of travel time savings: Evidence from a group-based modelling approach," Transportation Research Part A: Policy and Practice, Elsevier, vol. 88(C), pages 134-150.
    5. Beck, Matthew J. & Hess, Stephane, 2016. "Willingness to accept longer commutes for better salaries: Understanding the differences within and between couples," Transportation Research Part A: Policy and Practice, Elsevier, vol. 91(C), pages 1-16.
    6. Matthew J. Beck & John M. Rose, 2019. "Stated preference modelling of intra-household decisions: Can you more easily approximate the preference space?," Transportation, Springer, vol. 46(4), pages 1195-1213, August.
    7. André de Palma & Nathalie Picard & Robin Lindsey, 2024. "Activity and transportation decisions within households," Chapters, in: Stephane Hess & Andrew Daly (ed.), Handbook of Choice Modelling, chapter 16, pages 426-451, Edward Elgar Publishing.
    8. Mariel, Petr & Artabe, Alaitz, 2020. "Interpreting correlated random parameters in choice experiments," Journal of Environmental Economics and Management, Elsevier, vol. 103(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Boto-García, David & Mariel, Petr & Baños-Pino, José Francisco, 2023. "Intra-household bargaining for a joint vacation," Journal of choice modelling, Elsevier, vol. 47(C).
    2. Alistair Munro, 2018. "Intra†Household Experiments: A Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 32(1), pages 134-175, February.
    3. Rungie, Cam & Scarpa, Riccardo & Thiene, Mara, 2014. "The influence of individuals in forming collective household preferences for water quality," Journal of Environmental Economics and Management, Elsevier, vol. 68(1), pages 161-174.
    4. Carlsson, Fredrik & He, Haoran & Martinsson, Peter & Qin, Ping & Sutter, Matthias, 2012. "Household decision making in rural China: Using experiments to estimate the influences of spouses," Journal of Economic Behavior & Organization, Elsevier, vol. 84(2), pages 525-536.
    5. Matthew J. Beck & John M. Rose, 2019. "Stated preference modelling of intra-household decisions: Can you more easily approximate the preference space?," Transportation, Springer, vol. 46(4), pages 1195-1213, August.
    6. Martina Menon & Federico Perali & Marcella Veronesi, 2014. "Recovering Individual Preferences for Non-Market Goods: A Collective Travel-Cost Model," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 96(2), pages 438-457.
    7. Mariel, Petr & Scarpa, Riccardo & Vega-Bayo, Ainhoa, 2018. "Joint parental school choice: Exploring the influence of individual preferences of husbands and wives," Regional Science and Urban Economics, Elsevier, vol. 68(C), pages 23-35.
    8. David Hensher & Matthew Beck & John Rose, 2011. "Accounting for Preference and Scale Heterogeneity in Establishing Whether it Matters Who is Interviewed to Reveal Household Automobile Purchase Preferences," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 49(1), pages 1-22, May.
    9. Beck, Matthew J. & Hess, Stephane, 2016. "Willingness to accept longer commutes for better salaries: Understanding the differences within and between couples," Transportation Research Part A: Policy and Practice, Elsevier, vol. 91(C), pages 1-16.
    10. Edoardo Marcucci & Amanda Stathopoulos & Lucia Rotaris & Romeo Danielis, 2011. "Comparing Single and Joint Preferences: A Choice Experiment on Residential Location in Three-Member Households," Environment and Planning A, , vol. 43(5), pages 1209-1225, May.
    11. Panchalingam, Thadchaigeni & Howard, Gregory & Allen Klaiber, H. & Roe, Brian E., 2023. "Food choice behavior of adolescents under parent-child interaction in the context of US school lunch programs," Food Policy, Elsevier, vol. 115(C).
    12. Yang, Xiaojun & Carlsson, Fredrik, 2012. "Intra-household decisions making on intertemporal choices: An experimental study in rural China," Working Papers in Economics 537, University of Gothenburg, Department of Economics.
    13. Donna Dosman & Wiktor Adamowicz, 2006. "Combining Stated and Revealed Preference Data to Construct an Empirical Examination of Intrahousehold Bargaining," Review of Economics of the Household, Springer, vol. 4(1), pages 15-34, March.
    14. Nesha Beharry-Borg & David Hensher & Riccardo Scarpa, 2009. "An Analytical Framework for Joint vs Separate Decisions by Couples in Choice Experiments: The Case of Coastal Water Quality in Tobago," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 43(1), pages 95-117, May.
    15. Bouscasse, Hélène & de Lapparent, Matthieu, 2019. "Perceived comfort and values of travel time savings in the Rhône-Alpes Region," Transportation Research Part A: Policy and Practice, Elsevier, vol. 124(C), pages 370-387.
    16. Jeremy Lise & Shannon Seitz, 2011. "Consumption Inequality and Intra-household Allocations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 78(1), pages 328-355.
    17. Broberg, Thomas & Daniel, Aemiro Melkamu & Persson, Lars, 2021. "Household preferences for load restrictions: Is there an effect of pro-environmental framing?," Energy Economics, Elsevier, vol. 97(C).
    18. André de Palma & Nathalie Picard & Ignacio Inoa, 2014. "Discrete choice decision-making with multiple decision-makers within the household," Chapters, in: Stephane Hess & Andrew Daly (ed.), Handbook of Choice Modelling, chapter 16, pages 363-382, Edward Elgar Publishing.
    19. Ahlheim, Michael & Schneider, Friedrich, 2013. "Considering Household Size in Contingent Valuation Studies," VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79974, Verein für Socialpolitik / German Economic Association.
    20. Rana Hendy & Catherine Sofer, 2010. "A Collective Model of Female Labor Supply : Do Distribution Factors Matter in the Egyptian Case ?," Post-Print halshs-00482492, HAL.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:transp:v:41:y:2014:i:4:p:745-763. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.