Matthew Kovach, Gerelt Tserenjigmid
arXiv 14 Dec 2021 · Theoretical Economics · publishedJournal of Political Economy (2022) · 19 citations (OpenAlex)
arXiv:2112.07155 · PDF · DOI · OpenAlex · Extracted main text
We provide the first behavioral characterization of nested logit, a foundational and widely applied discrete choice model, through the introduction of a non-parametric version of nested logit that we call Nested Stochastic Choice (NSC). NSC is characterized by a single axiom that weakens Independence of Irrelevant Alternatives based on revealed similarity to allow for the similarity effect. Nested logit is characterized by an additional menu-independence axiom. Our axiomatic characterization leads to a practical, data-driven algorithm that identifies the true nest structure from choice data. We also discuss limitations of generalizing nested logit by studying the testable implications of cross-nested logit.
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The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.
| Reference | Intensity | Mentions | Sections | Main text | |
|---|---|---|---|---|---|
| 1 | Gul, F., P. Natenzon, and W. Pesendorfer (2014) Random choice as behavioral optimization | 0.928 | 4 | 3 | 100% |
| 2 | Tversky, A (1972) Elimination by Aspects: A Theory of Choice | 0.843 | 3 | 3 | 100% |
| 3 | Debreu, G (1960) Review of RD Luce, Individual choice behavior: A theoretical analysis | 0.737 | 3 | 2 | 100% |
| 4 | Li, J. and R. Tang (2016) Associationistic Luce Rule | 0.737 | 3 | 2 | 100% |
| 5 | Train, K. E., D. L. McFadden, and M. Ben-Akiva (1987) The demand for local telephone service: A fully discrete model of residential calling patterns and service choices | 0.737 | 3 | 2 | 100% |
| 6 | Vovsha, P (1997) Application of cross-nested logit model to mode choice in Tel Aviv, Israel, metropolitan area | 0.737 | 3 | 2 | 100% |
| 7 | Foubert, B. and E. Gijsbrechts (2007) Shopper Response to Bundle Promotions for Packaged Goods | 0.644 | 2 | 2 | 100% |
| 8 | Ben-Akiva, M. and M. Bierlaire (1999) Discrete choice methods and their applications to short term travel decisions, in | 0.644 | 2 | 2 | 100% |
| 9 | McFadden, D (1978) Modeling the choice of residential location, in | 0.585 | 3 | 1 | 100% |
| 10 | Goldberg, P. K (1995) Product differentiation and oligopoly in international markets: The case of the US automobile industry | 0.511 | 2 | 2 | 50% |
Showing the top 10 of 50 scored citations.
arXiv econ.EM papers that cite this one, ranked by how heavily they lean on it.
| Citing paper | Intensity | Mentions | Sections | |
|---|---|---|---|---|
| 1 | Decision Conflict, Power Logit, and the Deferral Outside Option | 0.405 | 1 | 1 |