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Capturing Preference Heterogeneity in Stated Choice Models: A Random Parameter Logit Model of the Demand for GM Food

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  • D Rigby
  • M Burton

Abstract

Analyses of data from random utility models of choice data have typically used fixed parameter representations, with consumer heterogeneity introduced by including factors such as the age, gender etc of the respondent. However, there is a class of models that assume that the underlying parameters of the estimated model (and hence preferences) are different for each individual within the sample, and that choices can be explained by identifying the parameters of the distribution from which they are drawn. Such a random parameter model is applied to stated choice data from the UK, and the results compared with standard fixed parameter models. The results provide new evidence of preferences for various aspects of the UK food system, particularly in relation to GM food but other environmental and technical aspects also. Indications of how random parameter models might be developed further are discussed on the basis of these results.
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Suggested Citation

  • D Rigby & M Burton, 2003. "Capturing Preference Heterogeneity in Stated Choice Models: A Random Parameter Logit Model of the Demand for GM Food," The School of Economics Discussion Paper Series 0319, Economics, The University of Manchester.
  • Handle: RePEc:man:sespap:0319
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    File URL: http://hummedia.manchester.ac.uk/schools/soss/economics/discussionpapers/EDP-0319.pdf
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    1. Lusk, Jayson L. & Daniel, M. Scott & Mark, Darrell R. & Lusk, Christine L., 2001. "Alternative Calibration And Auction Institutions For Predicting Consumer Willingess To Pay For Nongenetically Modified Corn Chips," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 26(1), pages 1-18, July.
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    Cited by:

    1. Doherty, Edel & Campbell, Danny, 2011. "Demand for improved food safety and quality: a cross-regional comparison," 85th Annual Conference, April 18-20, 2011, Warwick University, Coventry, UK 108791, Agricultural Economics Society.
    2. Mike Fitzpatrick & Christos D. Maravelias & Ole Ritzau Eigaard & Stephen Hynes & David Reid, 2014. "Modelling FIshers' preferences for alternative management options under the Common Fisheries Policy," Working Papers 262565, National University of Ireland, Galway, Socio-Economic Marine Research Unit.
    3. William H. Kaye-Blake & Caroline M. Saunders & Selim Cagatay, 2008. "Genetic Modification Technology and Producer Returns: The Impacts of Productivity, Preferences, and Technology Uptake," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 30(4), pages 692-710.
    4. Prosper Houessionon & William M. Fonta & Aymar Y. Bossa & Safiétou Sanfo & Noel Thiombiano & Pam Zahonogo & Thomas B. Yameogo & Bedru Balana, 2017. "Economic Valuation of Ecosystem Services from Small-Scale Agricultural Management Interventions in Burkina Faso: A Discrete Choice Experiment Approach," Sustainability, MDPI, Open Access Journal, vol. 9(9), pages 1-16, September.
    5. Kaye-Blake, William & Bicknell, Kathryn & Saunders, Caroline M., 2005. "Process versus product: which determines consumer demand for genetically modified apples?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 49(4), pages 1-15.
    6. Jesús Barreiro-Hurlé & José Gómez-Limón, 2008. "Reconsidering Heterogeneity and Aggregation Issues in Environmental Valuation: A Multi-attribute Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 40(4), pages 551-570, August.
    7. Edel Doherty & Brendan Kennelly & Darragh Flannery & Stephen Kynes & John Considine, 2013. "Student preferences for assignment systems: Results from a discrete choice experiment in Irish universities," Working Papers WP052013, University of Limerick, Department of Economics, revised Sep 2013.
    8. Camarena-Gomez, Dena M. & Sanjuan, Ana Isabel, 2005. "Walnut Preferences in Spain: Is the Spanish Consumer Ready for New Varieties?," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24749, European Association of Agricultural Economists.

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