Interpretation issues in heteroscedastic conditional logit models

This paper identifies an issue with interpretation of significance within heteroscedastic conditional logit models, due to sensitivity of reported results to arbitrary variable-normalization decisions. We advocate the use of willingness-to-pay (WTP) space models to avoid this, as estimates of WTP do not exhibit this effect. However, in cases where error variance may be high, we question whether it is correct to infer that all respondents should be considered to hold a common WTP.


Issue Date:
May 15 2016
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/235296
Total Pages:
8
JEL Codes:
C10; C18; C51; Q51
Series Statement:
Working papers
1603




 Record created 2017-04-01, last modified 2017-08-29

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)