Dynamic discrete choice structural models: A survey

Aguirregabiria, Vı́ctor; Mira, Pedro

doi:10.1016/j.jeconom.2009.09.007

Cited by 314 publications

(112 citation statements)

References 95 publications

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“…This assumption is popular in the literature on dynamic discrete-choice models (see Aguirregabiria and Mira (2010)) because it delivers a closed-form solution of expectations of future utility conditional on the states and, thus, significantly reduces the computational burden.…”

Section: Assumption 1 the Demand Shocks ε Ijt Are Independently And Imentioning

confidence: 99%

Consumer Stockpiling and Sales Promotions

Lu¹

2017

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Consumer Stockpiling and Sales PromotionsAnna Lu * AbstractIn retailing markets of storable goods, consumer behavior is typically characterized by stockpiling. While existing research has developed rich models for such strategic consumer behavior, little is known about how sellers should ideally respond to it. In this paper, we provide insights into how frequency and depth of promotions affect consumer purchases and seller revenues in the long run. We show an application to the U.S. market for laundry detergent.We use estimates from a structural dynamic demand model to simulate different pricing policies and find that in the detergent market, an increase in promotion depth is more effective than a change in promotion length. Our results suggest that this finding can be translated to markets with a large heterogeneity in storage costs and steady consumption rates. JEL: M31, D22, L11

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Section: Assumption 1 the Demand Shocks ε Ijt Are Independently And Imentioning

confidence: 99%

Consumer Stockpiling and Sales Promotions

Lu¹

2017

SSRN Journal

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“…In addition, many early studies applied binary choice settings; Rust (1996) was the first to apply multinomial choice setting. There exist survey papers on dynamic discrete choice models, such as those proposed by Eckstein and Wolpin (1989), Puterman (1990), Rust (1994), Rust (1996), Aguirregabiria and Mira (2010).…”

Section: Related Workmentioning

confidence: 99%

Analysis of dynamic decision-making in a bicycle-sharing auction using a dynamic discrete choice model

Hara

Hato

2017

Transportation

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For clarifying the usefulness and practical issues of a tradable permit system empirically, we implemented a tradable permit system for a bicycle-sharing service in Yokohama city, Japan. We analyzed both travel and transaction behavior within this system. Many activity factors, such as the amount of free time in each day, home location and travel mode to the bicycle port, were shown to affect the transaction of tradable permits. The results of the pilot program indicated that inefficient allocation of tradable permits occurred when participants postponed their decision-making because of uncertainty. To determine the reason for this effect and the contributing factors, we created a dynamic discrete choice model to describe the choice results and timing. The estimation result indicated that the option value of postponing decision-making caused the transactions to be performed at the last minute, and that this effect blocked the liquidity of the permits trade. In addition, because the result reveals that there was heterogeneity in the time discount factor, the initial allocation of permits was found to be important for efficient allocation.

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“…The traveler chooses the next link given the current state in a stochastic process having the Markov property (Rust;1987;2010). In our setting the next state is just the chosen link and it is given with certainty by the action.…”

Section: The Recursive Logit Modelmentioning

confidence: 99%

“…This paper is the first to provide links between the sequential link based route choice model and the finite multinomial logit model in the context of route choice. Second, we are also the first to provide an interpretation of the model as a dynamic discrete choice model (Rust;1987;2010), connecting the path choice problem to that literature. Third, we are the first to discuss estimation of the model, including by sampling of alternatives 1978).…”

Section: Introductionmentioning

confidence: 99%

A link based network route choice model with unrestricted choice set

Fosgerau

Frejinger

Karlström

2013

Transportation Research Part B: Methodological

216

139

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This paper considers the path choice problem, formulating and discussing an econometric random utility model for the choice of path in a network with no restriction on the choice set. Starting from a dynamic specification of link choices we show that it is equivalent to a static model of the multinomial logit form but with infinitely many alternatives. The model can be consistently estimated and used for prediction in a computationally efficient way. Similarly to the path size logit model, we propose an attribute called link size that corrects utilities of overlapping paths but that is link additive. The model is applied to data recording path choices in a network with more than 3,000 nodes and 7,000 links.

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Dynamic discrete choice structural models: A survey

Cited by 314 publications

References 95 publications

Consumer Stockpiling and Sales Promotions

Consumer Stockpiling and Sales Promotions

Analysis of dynamic decision-making in a bicycle-sharing auction using a dynamic discrete choice model

A link based network route choice model with unrestricted choice set

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