RT Journal Article
SR Electronic
T1 Modeling Hidden Alternatives in Random Utility Models: An Application to “Don’t Know” Responses in Contingent Valuation
JF Land Economics
JO Land Econ
FD University of Wisconsin Press
SP 445
OP 454
DO 10.3368/le.81.3.445
VO 81
IS 3
A1 Caudill, Steven B.
A1 Groothuis, Peter A.
YR 2005
UL http://le.uwpress.org/content/81/3/445.abstract
AB We develop a multinomial logit model with missing information that can be used to test for hidden alternatives in random utility models and contingent valuation analysis. To illustrate our latent-choice technique, we focus on the “don’t know” responses in dichotomous choice contingent valuation questions. In this version of the latent-choice model, we probabilistically reassign “don’t know” responses to either the “yes” or “no” categories (or leave them in the “don’t know” category), if indicated by the data. We find that in our two studies a statistically significant number of the “don’t know” responses are actually “no” responses. (JEL C25, Q26)