Valuation of Travel Time Savings in WTP and Preference Space in the Presence of Taste and Scale Heterogeneity
By David A. Hensher, William H. Greene. Journal of Transport Economics and Policy, 2011
119 citations recorded by the source corpus.
A major concern with the derivation of willingness to pay (WTP) distributions from mixed logit models is the incidence of values over a range that are deemed 'behaviourally questionable', with respect to the sign and magnitude. Recent research in redefining the 'space' within which a choice model is estimated as WTP space, instead of preference-space, has offered encouraging evidence in reducing the range of behavioural implausibility. This paper develops models to compare the empirical evidence when a mixed logit model is estimated with unconstrained distributions on random parameters in WTP and preference space, taking into account scale and the correlation between the attributes. The findings suggest that the gap between the evidence in WTP and preference space narrows significantly when both scale and preference heterogeneity are identified.
Subfields: Economics and Econometrics, Transportation
View Paper: https://www.semanticscholar.org/paper/7865d876826d82b4a91ac83753bda68434fc0cd9
How researchers see this paper
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In Economics and Econometrics
- David A. Hensher
- William H. Greene
- Kenneth Small
- Stephane Hess
- John M. Rose
- Chandra R. Bhat
- Mogens Fosgerau
- Riccardo Scarpa
In Transportation
- David A. Hensher
- William H. Greene
- Kenneth Small
- Stephane Hess
- John M. Rose
- Mogens Fosgerau
- Riccardo Scarpa
- Alejandro Tirachini
Citations in the corpus
- Does scale heterogeneity across individuals matter? An empirical assessment of alternative logit models (2010, methodology): “We, as well as Train and Weeks (2005), have found, in application, that this form of the transformed model produces generally much more reasonable estimates of willingness to pay for individuals in the sample than the model in the original form in which WTP is computed using ratios of parameters (He”
- Valuation of Travel Time (2012, background): “Train and Weeks (2005) and Hensher and Greene (2011) report that such models produce much smaller dispersion in WTP measures such as VOT.”