Publication Type
Journal Article
Version
acceptedVersion
Publication Date
12-2017
Abstract
In this paper, we study the relationship between several well known classes of discrete choice models, i.e., the random utility model (RUM), the representative agent model (RAM), and the semiparametric choice model (SCM). Using a welfare-based model as an intermediate, we show that the RAM and the SCM are equivalent. Furthermore, we show that both models as well as the welfare-based model strictly subsume the RUM when there are three or more alternatives, while the four are equivalent when there are only two alternatives. Thus, this paper presents a complete picture of the relationship between these choice models.
Keywords
welfare function, random utility model, representative agent model, semiparametric choice model
Discipline
Operations and Supply Chain Management
Research Areas
Operations Management
Publication
Operations Research
Volume
65
Issue
6
First Page
1516
Last Page
1525
ISSN
0030-364X
Identifier
10.1287/opre.2017.1602
Publisher
INFORMS (Institute for Operations Research and Management Sciences)
Citation
FENG, Guiyun; LI, Xiaobo; and WANG, Zizhuo.
Technical note—On the relation between several discrete choice models. (2017). Operations Research. 65, (6), 1516-1525.
Available at: https://ink.library.smu.edu.sg/lkcsb_research/6498
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1287/opre.2017.1602