Joint Estimation of Process and Outcome in Choice Experiments and Implications for Willingness to Pay
There is a growing recognition that the study of discrete choice outcomes should take into account the process rules that are used to establish eligibility of each attribute. This paper proposes a joint process-outcome model in which the choices made are conditioned on the rules adopted by each respondent in assessing the attributes packaged in the definition of each alternative. We set out a joint model and estimate two sets of panel-based mixed logit models - one set in which we ignore the attribute processing rules and one set in which we explicitly account for the rules. Using data from a commuter car trip study of unlabelled packages of times and cost attributes, we identify willingness to pay distributions for travel time savings under the various process rules. The main finding is that failing to account for the process rules tends to result in statistically higher mean estimates of values of travel time savings. © 2008 LSE and the University of Bath
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