The chapter points out the need to have a credible behavioural theory on which forecasting can be based, rather than correlations observed in the data. It then goes on to present methods to deal with a range of issues that arise in forecasting with choice models. It discusses procedures for...

Sampling is a key step in the empirical study of choice behaviour. It consists of selecting observations and/or alternatives from a target population within an available resource budget under a specified protocol. In this chapter, we review several sampling approaches and discuss their...

Endogeneity is the most severe failure that a discrete choice model can face in its objective of making causal inference or forecasting. It occurs when the explanatory variables are not independent of the error term and results in inconsistent estimators of the model parameters. This chapter...

This chapter reviews the Bayesian analysis of random utility models (RUM) for conjoint analysis. The economic theory of conjoint analysis and Bayesian estimation are remarkably related because the foundation of Bayesian decision theory derives subjective probabilities and utilities from...

In this chapter, we explore dynamic choice problems - where choices made in the present are both dependent on those in the past and will also affect those in the future. We start by considering the dynamic choice problem from two different perspectives: that of the decision maker and that of the...

Households are often responsible for labour supply, time allocation, transportation and many other decisions. Yet, research in both economics and transportation was traditionally dominated by so-called unitary models that treat households as single decision-making units with a representative...

Behavioural choice-making is an intricate process that has been typically simplified in the literature and we continue to see relatively little of the decision-processing literature incorporated into mainstream discrete choice modelling which is, increasingly, becoming the preferred empirical...

This chapter considers the estimation of binomial and multinomial discrete choice models that contain a random preference parameter with an unknown distribution, focusing on simple approaches where this unknown distribution is directly estimated.

There is evidence that behavior changes when individuals make choices over hypothetical scenarios and stakes rather than real scenarios and stakes. What is the nature of this evidence, and how significant is it for different types of inferences? In particular, does it follow that “stated...

Stated choice experiments are widely used in various fields in applied economics to elicit preferences of decision makers, to forecast choice behaviour, and to determine willingness-to-pay for characteristics of products, services, or policies. This chapter provides guidance in designing and...