[Limdep Nlogit List] estimating wtp with a cost-income ratio in the utility function

[medard kakuru]

Dear John,
I will try both, though prefer a log normal which is commonly used.
Thank you.

Medard

On Mon, Oct 7, 2024 at 7:53 PM John C. Whitehead via Limdep <
limdep at mailman.sydney.edu.au> wrote:

> Or uniform, or normal ... any distribution on cost that is constrained
> positive might be an improvement over a fixed cost coefficient or the log
> functional form.
>
> On Mon, Oct 7, 2024 at 12:18 PM Arthur Caplan via Limdep <
> limdep at mailman.sydney.edu.au> wrote:
>
> > Dear Medard,
> >
> > Have you thought about assigning a constrained triangular distribution to
> > the cost coefficient?
> >
> > Arthur Caplan
> >
> > -----Original Message-----
> > From: Limdep <limdep-bounces at mailman.sydney.edu.au> On Behalf Of medard
> > kakuru via Limdep
> > Sent: Monday, October 7, 2024 6:26 AM
> > To: Limdep and Nlogit Mailing List <limdep at mailman.sydney.edu.au>
> > Cc: medard kakuru <medakseth at gmail.com>
> > Subject: Re: [Limdep Nlogit List] estimating wtp with a cost-income ratio
> > in the utility function
> >
> > Dear John,
> > Yes, my first model is to make the cost coefficient fixed and a normal
> > distribution for other non-cost attributes. When I introduce a
> cost-income
> > ratio, I give the cost coefficient a log normal. Yes, the fixed cost
> > coefficient will not cause an explosion but it is being criticized for
> > assuming that individuals are cost insensitive. So I try to avoid it, I
> > make the cost coefficient log normal, which now causes an explosion.
> >
> > On Mon, Oct 7, 2024 at 2:55 PM John C. Whitehead via Limdep <
> > limdep at mailman.sydney.edu.au> wrote:
> >
> > > Medard,
> > >
> > > Did you make the cost coefficient fixed (no estimated standard
> > > deviation) or log normal. It is my understanding that the latter will
> > > blow up your wtp estimate. In my experience a fixed cost coefficient
> > > will cause no such damage.
> > >
> > > John Whitehead
> > >
> > > On Mon, Oct 7, 2024 at 7:48 AM medard kakuru via Limdep <
> > > limdep at mailman.sydney.edu.au> wrote:
> > >
> > > > Dear All,
> > > > I am estimating mixed logit models in preference and utility spaces.
> > > > My
> > > wtp
> > > > estimates are big as expected (because I made the cost parameter
> > > > fixed - according to Giergizny et al., 2012). To remedy the wtp
> > > > explosion, I include the cost-income ratio in the utility function,
> > > > necessitating an adjustment in the usual formula of computing wtp.
> > > > Please assist me with
> > > the
> > > > adjusted syntax that takes account of the ratio.
> > > > Thank you.
> > > >
> > > > Regards,
> > > >
> > > > Medard
> > > > PhD Student,
> > > > Makerere University Kampala
> > > >
> > > > On Thu, Oct 3, 2024 at 10:34 PM Steven Lavrenz via Limdep <
> > > > limdep at mailman.sydney.edu.au> wrote:
> > > >
> > > > > Are these quantities referring to the same statistic? If so, why
> > > > > the difference in naming convention within Limdep?
> > > > >
> > > > > Best Regards,
> > > > > Steve
> > > > >
> > > > > --
> > > > > Steven M. Lavrenz, PhD, RSP2I
> > > > > Assistant Professor
> > > > > Wayne State University
> > > > > Civil and Environmental Engineering
> > > > > 5050 Anthony Wayne Drive
> > > > > Detroit, MI 48202
> > > > > (313) 577-2086
> > > > > slavrenz at wayne.edu<mailto:slavrenz at wayne.edu>
> > > > >
> > > > >
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