This paper shows that Hausman-McFadden and related tests for the multinomial logit model are not informative about failure of IIA, but only about specification error in the deterministic part of the utilities attached to choice alternatives. It is shown that the multinomial logit cannot be...

The paper proposes an approach for evaluating the effect of flow fixed costs on the evaluation of environmental benefits with travel cost method. On a full annual perspective when recreational users incur relevant annual direct fixed expenses, their behaviour could be influenced by them. The...

Although rebates are widely employed, redemption is not effort-free, and the hassle of redemption is an important decision variable for buyers. The current research examines the impact of hassle cost on optimal rebate strategy. An analytical model is developed that simultaneously determines the...

Consumers choosing a cellular calling plan typically have many options to choose from. While the number of firms may be small, each offers a large number of calling plans, each one dealing with many options for each of the different types of services included in the contract (voice...

The behavioral implications of large discounts have been viewed from two opposing perspectives. From an attribution perspective, a large discount signals low quality and decreases the overall appeal of the product, but from a motivational account, a large discount seems attractive and increases...

Rice is a staple food in the West African nation of Sierra Leone with little difference in consumption between poor and wealthy households. Rice production is also an important source of livelihood with half of all households, three-quarters of rural households and about two-thirds of poor...

Consumers choosing a cellular calling plan typically have many options to choose from. While the number of firms may be small, each offers a large number of calling plans, each one dealing with many options for each of the different types of services included in the contract (voice...

A recent literature has provided empirical evidence that markups are increasing and are heterogeneous across firms. In standard monopolistic competition models, such heterogeneity implies inefficiency even in the presence of free entry. We enrich the standard model of monopolistic competition...

The disparity between willingness to pay and willingness to accept in experimental and survey settings remains a troubling anomaly. Willingness-to-accept is almost always higher than WTP, often substantially higher. Our interest lies with the neoclassical explanation of Hanemann, who...