Nonparametric vs parametric binary choice models: An empirical investigation
The estimation of conditional probability distribution functions (PDFs) in a kernel nonparametric framework has recently received attention. As emphasized by Hall, Racine and Li (2004), these conditional PDFs are extremely useful for a range of tasks including modelling and predicting consumer choice. The aim of this paper is threefold. First, we implement nonparametric kernel estimation of PDF with a binary choice variable and both continuous and discrete explanatory variables. Second, we address the issue of the performances of this nonparametric estimator when compared to a classic on-the-shelf parametric estimator, namely a probit. We propose to evaluate these estimators in terms of their predictive performances, in the line of the recent "revealed performance" test proposed by Racine and Parmeter (2009). Third, we provide a detailed discussion of the results focusing on environmental insights provided by the two estimators, revealing some patterns that can only be detected using the nonparametric estimator.
|Date of creation:||May 2009|
|Contact details of provider:|| Postal: 555 East Wells Street, Suite 1100, Milwaukee, Wisconsin 53202|
Phone: (414) 918-3190
Fax: (414) 276-3349
Web page: http://www.aaea.org
More information through EDIRC
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.:
- Christophe Bontemps & Céline Nauges, 2010.
"Carafe ou bouteille ? Le rôle de la qualité de l’environnement dans la décision du consommateur,"
INRA Sciences Sociales,
INRA Department of Economics.
- Christophe Bontemps & Céline Nauges, 2009. "Carafe ou bouteille ?. Le rôle de la qualité de l'environnement dans la décision du consommateur," Economie & Prévision, La Documentation Française, vol. 0(2), pages 61-79.
- Céline Nauges & Christophe Bontemps, 2009. "Carafe ou bouteille ? Le rôle de la qualité de l’environnement dans la décision du consommateur," Économie et Prévision, Programme National Persée, vol. 188(2), pages 61-79.
- Qi Li & Jeffrey Scott Racine, 2006. "Nonparametric Econometrics: Theory and Practice," Economics Books, Princeton University Press, edition 1, number 8355.
- Peter Hall & Jeff Racine & Qi Li, 2004. "Cross-Validation and the Estimation of Conditional Probability Densities," Journal of the American Statistical Association, American Statistical Association, vol. 99, pages 1015-1026, December.
- Briesch R.A. & Chintagunta P.K. & Matzkin R.L., 2002. "Semiparametric Estimation of Brand Choice Behavior," Journal of the American Statistical Association, American Statistical Association, vol. 97, pages 973-982, December.
- Li, Qi & Racine, Jeff, 2003. "Nonparametric estimation of distributions with categorical and continuous data," Journal of Multivariate Analysis, Elsevier, vol. 86(2), pages 266-292, August.
- Pagan,Adrian & Ullah,Aman, 1999.
Cambridge University Press, number 9780521355643, December.
- Hayfield, Tristen & Racine, Jeffrey S., 2008. "Nonparametric Econometrics: The np Package," Journal of Statistical Software, Foundation for Open Access Statistics, vol. 27(i05).
- Jeffrey S. Racine & Christopher F. Parmeter, 2012. "Data-Driven Model Evaluation: A Test for Revealed Performance," Department of Economics Working Papers 2012-13, McMaster University.
- BONTEMPS Christophe & NAUGES CÃ©line, 2006. "Carafe ou bouteille ? Le rÃ´le de la qualitÃ© de l'environnement dans la dÃ©cision du consommateur," LERNA Working Papers 06.07.200, LERNA, University of Toulouse.
When requesting a correction, please mention this item's handle: RePEc:ags:aaea09:49286. 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: (AgEcon Search)
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.