Testing the consistency of nested logit models with utility maximization

Testing The Consistency of Nested Logit Models with Utility Maximization

The Nested Multinomial Logit (NMNL) model is used extensively in modeling consumer choices among discrete alternatives when the number of alternatives is large. Unfortunately, applied researchers often find that estimated NMNL models fail to meet the Daly-ZacharyMcFadden (DZM) sufficient conditions for consistency with stochastic utility maximization. Borsch-Supan (1990) provides a relaxed set ...

Probit and nested logit models based on fuzzy measure

Inspired by the interactive discrete choice logit models [Aggarwal, 2019], this paper presents the advanced families of discrete choice models, such as nested logit, mixed logit, and probit models to consider the interaction among the attributes. Besides the DM's attitudinal character is also taken into consideration in the computation of choice probabilities. The proposed choice models make us...

Pricing Multiple Products with the Multinomial Logit and Nested Logit Models: Concavity and Implications

TWO RUMs unCLOAKED: Nested-Logit Models of Site Choice and Nested-Logit Models of Participation and Site Choice

Nested logit is increasingly advocated as a tool of recreational demand and benefit estimation. The intent of this short monograph is to lay out, in a simple fashion, the theory behind the nested-logit model of site choice and the nested-logit model of participation and site choice. Rigorous but straightforward derivations of the properties of nested-logit models are provided, including the pro...

Pricing Problems Under the Nested Logit Model with a Quality Consistency Constraint

We consider pricing problems when customers choose among the products according to the nested logit model and there is a quality consistency constraint on the prices charged for the products. We consider two types of quality consistency constraints. In the first type of constraint, there is an inherent ordering between the qualities of the products in a particular nest and the price for the pro...