Discrete and Continuous Representations of Unobserved Heterogeneity in Choice Modeling

We attempt to provide insights into how heterogeneity has been and can be addressed in choice modeling. In doing so, we deal with three topics: Models of heterogeneity, Methods of estimation and Substantive issues. In describing models we focus on discrete versus continuous representations of hetero...

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Bibliographic Details
Published in:Marketing letters 1999-08, Vol.10 (3), p.219-232
Main Authors: Wedel, Michel, Kamakura, Wagner, Arora, Neeraj, Bemmaor, Albert, Chiang, Jeongwen, Elrod, Terry, Johnson, Rich, Lenk, Peter, Neslin, Scott, Poulsen, Carsten Stig
Format: Article
Language:English
Subjects:
Comparative analysis
Distribution
Economic models
Estimates
Estimation methods
Market segmentation
Market segments
Marketing
Markov analysis
Markov chains
Markovian processes
Mathematical independent variables
Maximum likelihood estimation
Modeling
Modelling
Monte Carlo simulation
Parametric models
Preferences
Random variables
Simulation
Simulations
Citations: Items that cite this one
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Description
Summary:We attempt to provide insights into how heterogeneity has been and can be addressed in choice modeling. In doing so, we deal with three topics: Models of heterogeneity, Methods of estimation and Substantive issues. In describing models we focus on discrete versus continuous representations of heterogeneity. With respect to estimation we contrast Markov Chain Monte Carlo methods and (simulated) likelihood methods. The substantive issues discussed deal with empirical tests of heterogeneity assumptions, the formation of empirical generalisations, the confounding of heterogeneity with state dependence and consideration sets, and normative segmentation.
ISSN:0923-0645
1573-059X
DOI:10.1023/A:1008054316179