A Survey of Preference Estimation with Unobserved Choice Set Heterogeneity

Gregory S Crawford; Rachel Griffith; Alessandro Iaria

doi:10.1016/j.jeconom.2020.07.024

A Survey of Preference Estimation with Unobserved Choice Set Heterogeneity

Gregory S Crawford^*, Rachel Griffith^*, Alessandro Iaria^*

^*Corresponding author for this work

School of Economics

Research output: Contribution to journal › Article (Academic Journal) › peer-review

8 Citations (Scopus)

134 Downloads (Pure)

Abstract

We provide an introduction to the estimation of discrete choice models when choice sets are heterogeneous and unobserved to the econometrician. We survey the two most popular approaches: “integrating over” and “differencing out” unobserved choice sets. Inspired by Chamberlain (1980)’s original idea of constructing sufficient statistics from observed choices, we introduce the term “sufficient set” to refer to any combination of observed choices that lies within the true but unobserved choice set. The concept of sufficient set helps to unify notation and organize our thinking, to map econometric assumptions onto economic models, and to implement both methods in practice.

Original language	English
Number of pages	40
Journal	Journal of Econometrics
Early online date	6 Aug 2020
DOIs	https://doi.org/10.1016/j.jeconom.2020.07.024
Publication status	E-pub ahead of print - 6 Aug 2020

Structured keywords

ECON Econometrics
ECON CEPS Data

Keywords

Discrete Choice Models
Panel Data
Unobserved Choice Sets
Unobserved Heterogeneity
Sufficient Sets

Access to Document

10.1016/j.jeconom.2020.07.024

Full-text PDF (final published version)
This is the final published version of the article (version of record). It first appeared online via Elsevier at https://doi.org/10.1016/j.jeconom.2020.07.024 . Please refer to any applicable terms of use of the publisher.
Proof, 1.16 MBLicence: CC BY

Handle.net

Persistent link

Embargoed Document

Full-text PDF (author’s accepted manuscript)
Accepted author manuscript, 1.03 MB
Request copy

Dr Alessandro Iaria
- alessandro.iariabristol.acuk
- School of Economics - Senior Lecturer in Economics
Person: Academic

Cite this

@article{08c87bdf537e437b8ed4fd4a507801e0,

title = "A Survey of Preference Estimation with Unobserved Choice Set Heterogeneity",

abstract = "We provide an introduction to the estimation of discrete choice models when choice sets are heterogeneous and unobserved to the econometrician. We survey the two most popular approaches: “integrating over” and “differencing out” unobserved choice sets. Inspired by Chamberlain (1980){\textquoteright}s original idea of constructing sufficient statistics from observed choices, we introduce the term “sufficient set” to refer to any combination of observed choices that lies within the true but unobserved choice set. The concept of sufficient set helps to unify notation and organize our thinking, to map econometric assumptions onto economic models, and to implement both methods in practice.",

keywords = "Discrete Choice Models, Panel Data, Unobserved Choice Sets, Unobserved Heterogeneity, Sufficient Sets",

author = "Crawford, {Gregory S} and Rachel Griffith and Alessandro Iaria",

year = "2020",

month = aug,

day = "6",

doi = "10.1016/j.jeconom.2020.07.024",

language = "English",

journal = "Journal of Econometrics",

issn = "0304-4076",

publisher = "North-Holland Publishing Company",

}

TY - JOUR

T1 - A Survey of Preference Estimation with Unobserved Choice Set Heterogeneity

AU - Crawford, Gregory S

AU - Griffith, Rachel

AU - Iaria, Alessandro

PY - 2020/8/6

Y1 - 2020/8/6

N2 - We provide an introduction to the estimation of discrete choice models when choice sets are heterogeneous and unobserved to the econometrician. We survey the two most popular approaches: “integrating over” and “differencing out” unobserved choice sets. Inspired by Chamberlain (1980)’s original idea of constructing sufficient statistics from observed choices, we introduce the term “sufficient set” to refer to any combination of observed choices that lies within the true but unobserved choice set. The concept of sufficient set helps to unify notation and organize our thinking, to map econometric assumptions onto economic models, and to implement both methods in practice.

AB - We provide an introduction to the estimation of discrete choice models when choice sets are heterogeneous and unobserved to the econometrician. We survey the two most popular approaches: “integrating over” and “differencing out” unobserved choice sets. Inspired by Chamberlain (1980)’s original idea of constructing sufficient statistics from observed choices, we introduce the term “sufficient set” to refer to any combination of observed choices that lies within the true but unobserved choice set. The concept of sufficient set helps to unify notation and organize our thinking, to map econometric assumptions onto economic models, and to implement both methods in practice.

KW - Discrete Choice Models

KW - Panel Data

KW - Unobserved Choice Sets

KW - Unobserved Heterogeneity

KW - Sufficient Sets

U2 - 10.1016/j.jeconom.2020.07.024

DO - 10.1016/j.jeconom.2020.07.024

M3 - Article (Academic Journal)

SN - 0304-4076

JO - Journal of Econometrics

JF - Journal of Econometrics

ER -

A Survey of Preference Estimation with Unobserved Choice Set Heterogeneity

Abstract

Structured keywords

Keywords

Access to Document

Handle.net

Embargoed Document

Fingerprint

Profiles

Dr Alessandro Iaria

Cite this