IDEAS home Printed from https://ideas.repec.org/p/tin/wpaper/20230012.html
   My bibliography  Save this paper

Preference estimation from point allocation experiments

Author

Listed:
  • Marion Collewet

    (Universiteit Leiden)

  • Paul Koster

    (Vrije Universiteit Amsterdam)

Abstract

Point allocation experiments are widely used in the social sciences. In these experiments, survey respondents distribute a fixed total number of points across a fixed number of alternatives. This paper reviews the different perspectives in the literature about what respondents do when they distribute points across options. We find three main alternative interpretations in the literature, each having different implications for empirical work. We connect these interpretations to models of utility maximization that account for point and budget constraints and investigate the role of budget constraints in more detail. We show how these constraints impact the regression specifications for point allocation experiments that are commonly used in the literature. We also show how a formulation of a taste for variety as entropy that had been previously used to analyse market shares can fruitfully be applied to choice behaviour in point allocation experiments.

Suggested Citation

  • Marion Collewet & Paul Koster, 2023. "Preference estimation from point allocation experiments," Tinbergen Institute Discussion Papers 23-0012/VIII, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20230012
    as

    Download full text from publisher

    File URL: https://papers.tinbergen.nl/23012.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Tversky, Amos & Kahneman, Daniel, 1992. "Advances in Prospect Theory: Cumulative Representation of Uncertainty," Journal of Risk and Uncertainty, Springer, vol. 5(4), pages 297-323, October.
    2. Richardson, Jeff & Sinha, Kompal & Iezzi, Angelo & Maxwell, Aimee, 2012. "Maximising health versus sharing: Measuring preferences for the allocation of the health budget," Social Science & Medicine, Elsevier, vol. 75(8), pages 1351-1361.
    3. Matthew Wiswall & Basit Zafar, 2018. "Preference for the Workplace, Investment in Human Capital, and Gender," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 133(1), pages 457-507.
    4. Peter A. Ubel & George Loewenstein, 1996. "Public Perceptions of the Importance of Prognosis in Allocating Transplantable Livers to Children," Medical Decision Making, , vol. 16(3), pages 234-241, August.
    5. Thijs Dekker & Paul (P.R.) Koster & Niek Mouter, 2019. "The economics of participatory value evaluation," Tinbergen Institute Discussion Papers 19-008/VIII, Tinbergen Institute.
    6. Herbert A. Simon, 1955. "A Behavioral Model of Rational Choice," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 69(1), pages 99-118.
    7. Granbois, Donald H & Summers, John O, 1975. "Primary and Secondary Validity of Consumer Purchase Probabilities," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 1(4), pages 31-38, March.
    8. 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.
    9. Verboven, Frank, 1996. "The nested logit model and representative consumer theory," Economics Letters, Elsevier, vol. 50(1), pages 57-63, January.
    10. Anderson, Simon Peter & de Palma, Andre & Thisse, Jacques-Francois, 1988. "A Representative Consumer Theory of the Logit Model," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 29(3), pages 461-466, August.
    11. Asher A. Blass & Saul Lach & Charles F. Manski, 2010. "Using Elicited Choice Probabilities To Estimate Random Utility Models: Preferences For Electricity Reliability," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 51(2), pages 421-440, May.
    12. Julie Ratcliffe, 2000. "Public preferences for the allocation of donor liver grafts for transplantation," Health Economics, John Wiley & Sons, Ltd., vol. 9(2), pages 137-148, March.
    13. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, April.
    14. Jeff Richardson & Angelo Iezzi & Aimee Maxwell & Gang Chen, 2018. "Does the use of the proportional shortfall help align the prioritisation of health services with public preferences?," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 19(6), pages 797-806, July.
    15. Andrew Comrey, 1950. "A proposed method for absolute ratio scaling," Psychometrika, Springer;The Psychometric Society, vol. 15(3), pages 317-325, September.
    16. Mouter, Niek & van Cranenburgh, Sander & van Wee, Bert, 2017. "Do individuals have different preferences as consumer and citizen? The trade-off between travel time and safety," Transportation Research Part A: Policy and Practice, Elsevier, vol. 106(C), pages 333-349.
    17. John R. Hauser & Steven M. Shugan, 1980. "Intensity Measures of Consumer Preference," Operations Research, INFORMS, vol. 28(2), pages 278-320, April.
    18. Morita, Tamaki & Managi, Shunsuke, 2015. "Consumers’ willingness to pay for electricity after the Great East Japan Earthquake," Economic Analysis and Policy, Elsevier, vol. 48(C), pages 82-105.
    19. M. Martin Boyer & Philippe De Donder & Claude Fluet & Marie-Louise Leroux & Pierre-Carl Michaud, 2020. "Long-Term Care Insurance: Information Frictions and Selection," American Economic Journal: Economic Policy, American Economic Association, vol. 12(3), pages 134-169, August.
    20. Chris Skedgel & Dean Regier, 2015. "Constant-Sum Paired Comparisons for Eliciting Stated Preferences: A Tutorial," The Patient: Patient-Centered Outcomes Research, Springer;International Academy of Health Preference Research, vol. 8(2), pages 155-163, April.
    21. Jeff Richardson & Angelo Iezzi & Aimee Maxwell, 2018. "Does a patient's health potential affect the social valuation of health services?," PLOS ONE, Public Library of Science, vol. 13(4), pages 1-15, April.
    22. Florian M. Artinger & Gerd Gigerenzer & Perke Jacobs, 2022. "Satisficing: Integrating Two Traditions," Journal of Economic Literature, American Economic Association, vol. 60(2), pages 598-635, June.
    23. Richard Batley, 2008. "On Ordinal Utility, Cardinal Utility and Random Utility," Theory and Decision, Springer, vol. 64(1), pages 37-63, February.
    Full references (including those not matched with items on IDEAS)

    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. Romuald Meango & Esther Mirjam Girsberger, 2023. "Identification of Ex ante Returns Using Elicited Choice Probabilities: an Application to Preferences for Public-sector Jobs," Papers 2303.03009, arXiv.org, revised Jun 2024.
    2. Kettlewell, Nathan & Walker, Matthew J. & Yoo, Hong Il, 2024. "Alternative Models of Preference Heterogeneity for Elicited Choice Probabilities," IZA Discussion Papers 16821, Institute of Labor Economics (IZA).
    3. Koşar, Gizem & Ransom, Tyler & van der Klaauw, Wilbert, 2022. "Understanding migration aversion using elicited counterfactual choice probabilities," Journal of Econometrics, Elsevier, vol. 231(1), pages 123-147.
    4. Gizem Koşar & Cormac O'Dea, 2022. "Expectations Data in Structural Microeconomic Models," Staff Reports 1018, Federal Reserve Bank of New York.
    5. Poinas, François & Méango, Romuald, 2023. "The (Option-)Value of Overstaying," TSE Working Papers 23-1478, Toulouse School of Economics (TSE).
    6. Romauld Méango, 2023. "Identification of ex ante returns using elicited choice probabilities," Economics Series Working Papers 1007, University of Oxford, Department of Economics.
    7. Collewet, Marion & Fairley, Kim & Kessels, Roselinde & Knoef, Marike & van Vliet, Olaf, 2024. "The design of welfare: unraveling taxpayers' preferences," OSF Preprints 4am7e, Center for Open Science.
    8. Pamela Giustinelli, 2022. "Expectations in Education: Framework, Elicitation, and Evidence," Working Papers 2022-026, Human Capital and Economic Opportunity Working Group.
    9. Romuald Meango, 2023. "Using Probabilistic Stated Preference Analyses to Understand Actual Choices," Papers 2307.13966, arXiv.org.
    10. Mogens Fosgerau & André de Palma, 2016. "Generalized entropy models," Working Papers hal-01291347, HAL.
    11. Robson, Matthew & O’Donnell, Owen & Van Ourti, Tom, 2024. "Aversion to health inequality — Pure, income-related and income-caused," Journal of Health Economics, Elsevier, vol. 94(C).
    12. da Silveira, Jaylson Jair & Lima, Gilberto Tadeu, 2021. "Wage inequality as a source of endogenous macroeconomic fluctuations," Structural Change and Economic Dynamics, Elsevier, vol. 56(C), pages 35-52.
    13. Ralph Stinebrickner & Todd R. Stinebrickner, 2014. "A Major in Science? Initial Beliefs and Final Outcomes for College Major and Dropout," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 81(1), pages 426-472.
    14. Stefano DellaVigna, 2009. "Psychology and Economics: Evidence from the Field," Journal of Economic Literature, American Economic Association, vol. 47(2), pages 315-372, June.
    15. Leković Milјan, 2020. "Cognitive Biases as an Integral Part of Behavioral Finance," Economic Themes, Sciendo, vol. 58(1), pages 75-96, March.
    16. Jaylson Jair da Silveira & Gilberto Tadeu Lima, 2017. "Employee Profit-sharing and Labor Extraction in a Classical Model of Distribution and Growth," Review of Political Economy, Taylor & Francis Journals, vol. 29(4), pages 613-635, October.
    17. Kidokoro, Yukihiro, 2016. "A micro foundation for discrete choice models with multiple categories of goods," Journal of choice modelling, Elsevier, vol. 19(C), pages 54-72.
    18. Pope, Robin & Selten, Reinhard & Kube, Sebastian, 2009. "Nominalist Heuristics and Economic Theory," Bonn Econ Discussion Papers 17/2009, University of Bonn, Bonn Graduate School of Economics (BGSE).
    19. Jakusch, Sven Thorsten & Meyer, Steffen & Hackethal, Andreas, 2019. "Taming models of prospect theory in the wild? Estimation of Vlcek and Hens (2011)," SAFE Working Paper Series 146, Leibniz Institute for Financial Research SAFE, revised 2019.
    20. Ji, Xiangfeng & Chu, Yanyu, 2020. "A target-oriented bi-attribute user equilibrium model with travelers’ perception errors on the tolled traffic network," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 144(C).

    More about this item

    Keywords

    constant-sum paired comparison; probabilistic choice; entropy; constrained optimization;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    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:tin:wpaper:20230012. 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: Tinbergen Office +31 (0)10-4088900 (email available below). General contact details of provider: https://edirc.repec.org/data/tinbenl.html .

    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.