The Role of Independence and Stationarity in Probabilistic Models of Binary Choice

After more then 50 years of probabilistic choice modeling in economics, marketing, political science, psychology, and related disciplines, theoretical and computational advances give scholars access to a sophisticated array of modeling and inference resources. We review some important, but perhaps o...

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Bibliographic Details
Published in:Journal of behavioral decision making 2018-01, Vol.31 (1), p.100-114
Main Authors: Regenwetter, Michel, Davis‐Stober, Clintin P.
Format: Article
Language:English
Subjects:
Computer applications
Decision making models
iid assumptions
Individual differences
Marketing
modeling heterogeneity
Political psychology
Political science
probabilistic choice models
Probabilistic models
Probability
Statistical analysis
Statistical inference
statistical testing
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Summary:After more then 50 years of probabilistic choice modeling in economics, marketing, political science, psychology, and related disciplines, theoretical and computational advances give scholars access to a sophisticated array of modeling and inference resources. We review some important, but perhaps often overlooked, properties of major classes of probabilistic choice models. For within‐respondent applications, we discuss which models require repeated choices by an individual to be independent and response probabilities to be stationary. We show how some model classes, but not others, are invariant over variable preferences, variable utilities, or variable choice probabilities. These models, but not others, accommodate pooling of responses or averaging of choice proportions within participant when underlying parameters vary across observations. These, but not others, permit pooling/averaging across respondents in the presence of individual differences. We also review the role of independence and stationarity in statistical inference, including for probabilistic choice models that, themselves, do not require those properties. Copyright © 2017 John Wiley & Sons, Ltd.
ISSN:0894-3257
1099-0771
DOI:10.1002/bdm.2037