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Using Elicited Choice Probabilities to Estimate Random Utility Models: Preferences for Electricity Reliability

  • Blass, Asher
  • Lach, Saul
  • Manski, Charles

When data on actual choices are not available, researchers studying preferences sometimes pose choice scenarios and ask respondents to state the actions they would choose if they were to face these scenarios. The data on stated choices are then used to estimate random utility models, as if they are data on actual choices. Stated choices may differ from actual ones because researchers typically provide respondents with less information than they would have facing actual choice problems. Elicitation of choice probabilities overcomes this problem by permitting respondents to express uncertainty about their behavior. This paper shows how to use elicited choice probabilities to estimate random utility models with random coefficients and applies the methodology to estimate preferences for electricity reliability in Israel.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 7030.

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Date of creation: Nov 2008
Date of revision:
Handle: RePEc:cpr:ceprdp:7030
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  1. Caves, Douglas W & Herriges, Joseph A & Windle, Robert J, 1990. "Customer Demand for Service Reliability in the Electric Power Industry: A Synthesis of the Outage Cost Literature," Bulletin of Economic Research, Wiley Blackwell, vol. 42(2), pages 79-119, April.
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  4. F. Thomas Juster, 1966. "Consumer Buying Intentions and Purchase Probability: An Experiment in Survey Design," NBER Books, National Bureau of Economic Research, Inc, number just66-2, December.
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  6. Manski, Charles F., 1975. "Maximum score estimation of the stochastic utility model of choice," Journal of Econometrics, Elsevier, vol. 3(3), pages 205-228, August.
  7. Charles F. Manski, 2007. "Partial Identification Of Counterfactual Choice Probabilities," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 48(4), pages 1393-1410, November.
  8. Delavande, Adeline, 2005. "Pill, Patch or Shot? Subjective Expectations and Birth Control Choice," CEPR Discussion Papers 4856, C.E.P.R. Discussion Papers.
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  12. Matzkin, Rosa L, 1992. "Nonparametric and Distribution-Free Estimation of the Binary Threshold Crossing and the Binary Choice Models," Econometrica, Econometric Society, vol. 60(2), pages 239-70, March.
  13. Manski, Charles F. & Molinari, Francesca, 2010. "Rounding Probabilistic Expectations in Surveys," Journal of Business & Economic Statistics, American Statistical Association, vol. 28(2), pages 219-231.
  14. Manski, Charles F, 1999. "Analysis of Choice Expectations in Incomplete Scenarios," Journal of Risk and Uncertainty, Springer, vol. 19(1-3), pages 49-66, December.
  15. Manski, Charles F., 1985. "Semiparametric analysis of discrete response : Asymptotic properties of the maximum score estimator," Journal of Econometrics, Elsevier, vol. 27(3), pages 313-333, March.
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