The multinomial logit model revisited: A semi-parametric approach in discrete choice analysis

The multinomial logit model in discrete choice analysis is widely used in transport research. It has long been known that the Gumbel distribution forms the basis of the multinomial logit model. Although the Gumbel distribution is a good approximation in some applications such as route choice problems, it is chosen mainly for mathematical convenience. This can be restrictive in many other scenarios in practice. In this paper we show that the assumption of the Gumbel distribution can be substantially relaxed to include a large class of distributions that is stable with respect to the minimum operation. The distributions in the class allow heteroscedastic variances. We then seek a transformation that stabilizes the heteroscedastic variances. We show that this leads to a semi-parametric choice model which links the linear combination of travel-related attributes to the choice probabilities via an unknown sensitivity function. This sensitivity function reflects the degree of travelers’ sensitivity to the changes in the combined travel cost. The estimation of the semi-parametric choice model is also investigated and empirical studies are used to illustrate the developed method.     

Random covariance heterogeneity in discrete choice models

In this paper, we extend the standard discrete choice modelling framework by allowing for random variations in the substitution patterns between alternatives across respondents, leading to increased model flexibility. The paper shows how such a Mixed Covariance model can be specified either with purely random variation or with a mixture of random and deterministic variation. Additionally, the model can be based on an underlying GEV or ECL structure. Finally, the model can be specified as a continuous mixture or as a discrete mixture. An application on Stated Preference data for the choice of departure time and travel mode shows that important gains in model performance can be obtained by allowing for random covariance heterogeneity. Furthermore, the approach leads to significant differences in the implied willingness to pay measures, and the substitution patterns between alternatives.     

Allowing for heterogeneous decision rules in discrete choice models: an approach and four case studies

The study of respondent heterogeneity is one of the main areas of research in the field of choice modelling. The general emphasis is on variations across respondents in relative taste parameters while maintaining the assumption of homogeneous utility maximising decision rules. While recent work has allowed for differences in the utility specification across respondents in the context of looking at heterogeneous information processing strategies, the underlying assumption that all respondents employ the same choice paradigm remains. This is despite evidence in the literature that different paradigms work differently well on given datasets. In this article, we argue that such differences may in fact extend to respondents within a single dataset. We accommodate these differences in a latent class model, where individual classes make use of different underlying paradigms. We present four applications using three different datasets, showing mixtures between “standard” random utility maximisation models and lexicography based models, models with multiple reference points, elimination by aspects models and random regret minimisation models. In each of the case studies, the behavioural mixing model obtains significant gains in fit over the base structure where all respondents are hypothesised to use the same rule. The findings offer important further insights into the behavioural patterns of respondents. There is also evidence that what is retrieved as taste heterogeneity in standard models may in fact be heterogeneity in decision rules.     

Identifying variations and co-variations in discrete choice models

This study introduces an extended version of a standard multilevel cross-classified logit model which takes co-variations into account, i.e., variations jointly caused by two or more unobserved factors. Whilst focusing on mode choice behavior, this study deals with four different types of variation: spatial variations, inter-individual variations, intra-individual variations and co-variations between inter-individual and spatial variations. Such co-variations represent individual-specific spatial effects, reflecting different responses to the same space among individuals, which may for example be due to differences in their spatial perceptions. In our empirical analysis, we use data from Mobidrive (a continuous six-week travel survey) to clarify the existence of co-variation effects by comparing two models with and without co-variation terms. The results of this analysis indicate that co-variations certainly exist, especially for utility differences in bicycle and public transport use in comparison with car use. We then sequentially introduce four further sets of explanatory variables, examine the sources of behavioral variations and determine what types of influential factors are dominant in mode choice behavior.     

A methodological approach for developing and assessing business models for flexible transport systems

Flexible transport services include a wide range of demand responsive transport systems that provide non-conventional passenger and freight transportation services. Several alternative business models varying according to the local market conditions, the socio-economic, legal, and institutional framework may be developed for the provision of Flexible Transport Systems (FTS). The objective of this paper is twofold: first to present an integrated methodological framework for developing and assessing alternative FTS business models and second to demonstrate its applicability to a case study regarding the prioritization of alternative FTS business models for the provision of flexible passenger transport services in Helsinki.

Price-based regulation of oligopolistic markets under discrete choice models of demand

We propose a framework to find optimal price-based policies to regulate markets characterized by oligopolistic competition and in which consumers make a discrete choice among a finite set of alternatives. The framework accommodates general discrete choice models available in the literature in order to capture heterogeneous consumer behavior. In our work, consumers are utility maximizers and are modeled according to random utility theory. Suppliers are modeled as profit maximizers, according to the traditional microeconomic treatment. Market competition is modeled as a non-cooperative game, for which an approximate equilibrium solution is sought. Finally, the regulator can affect the behavior of all other agents by giving subsidies or imposing taxes to consumers. In transport markets, economic instruments might target specific alternatives, to reduce externalities such as congestion or emissions, or specific segments of the population, to achieve social welfare objectives. In public policy, different agents have different individual or social objectives, possibly conflicting, which must be taken into account within a social welfare function. We present a mixed integer optimization model to find optimal policies subject to supplier profit maximization and consumer utility maximization constraints. Then, we propose a model-based heuristic approach based on the fixed-point iteration algorithm that finds an approximate equilibrium solution for the market. Numerical experiments on an intercity travel case study show how the regulator can optimize its decisions under different scenarios.

     

Testing probabilistic discrete choice models of travel demand by comparing predicted and observed aggregate choice shares

Probabilistic discrete choice models of travel demand often are tested for the presence of specification errors by comparing the models' predictions of aggregate choice shares in population strata with observed shares. A model is rejected as misspecified if the differences between its predictions and the observations are judged too large. This judgement usually is made on intuitive grounds without use of formal statistical methods and, therefore includes no systematic method for distinguishing the effects of specification errors on differences between predictions and observations from those of random sampling errors. This paper represents formal statistical tests for comparing predicted and observed aggregate chioce shares in population strata and reports the results of an investigation of the power of the tests. The test statistics are asymptotically χ² disturbed when the model being tested is correctly specified. The results of the power investigation suggests that greater power is obtained (i.e. there is ability to detect misspecified models) when all of the available data are used for both parameter estimation and specification testing than when the available data are divided into separate estimation and test data sets. Specification tests based on comparisons of predicted and observed aggregate choice shares appear to have less power than do likelihood ratio and likelihood ratio index specification tests when the alternative models required by the latter tests are correctly or approximately correctly specified. However, tests based on comparisons of predicted and observed shares ca have greater power than the other tests when the alternative models are seriouslymisspecified.     

Exploring the feasibility of classification trees versus ordinal discrete choice models for analyzing crash severity

A cross-median crash (CMC) is one of the most severe types of crashes in which a vehicle crosses the median and sometimes collides with opposing traffic. A study of severity of CMCs in the state of Wisconsin was conducted by Lu et al. in 2010. Discrete choice models, namely ordinal logit and probit models were used to analyze factors related to the severity of CMCs. Separate models were developed for single and multi-vehicle CMCs. Although 25 different crash, roadway, and geometric variables were used, only 3 variables were found to be statistically significant which were alcohol usage, posted speed, and road conditions. The objective of this research was to explore the feasibility of GUIDE Classification Tree method to analyze the severity of CMCs to discover if any additional information could be revealed.A dataset of CMCs in the state of Wisconsin between 2001 and 2007, used in the study by Lu et al. was used to develop three different GUIDE Classification Trees. Additionally, the effects of variable types (continuous or discrete), misclassification costs, and tree pruning characteristics on models results were also explored. The results were directly compared with discrete choice models developed in the study by Lu et al. showing that the GUIDE Classification Trees revealed new variables (median width and traffic volume) that affect CMC severity and provided useful insight on the data. The results of this research suggest that the use of Classification Tree analysis should at least be considered in conjunction with regression-based crash models to better understand factors affecting crashes. Classification Tree models were able to reveal additional information about the dependent variable and offer advantages with respect to multicollinearity and variable redundancy issues.     

Neighborhoods,cars, and commuting in New York City: A discrete choice approach

Cities around the world are trying out a multitude of transportation policy and investment alternatives with the aim of reducing car-induced externalities. However, without a solid understanding of how people make their transportation and residential location choices, it is hard to tell which of these policies and investments are really doing the job and which are wasting precious city resources. The focus of this paper is the determinants of car ownership and car use for commuting. Using survey data from 1997 to 1998 collected in New York City, this paper uses discrete choice econometrics to estimate a model of the choices of car ownership and commute mode while also modeling the related choice of residential location.The main story told by this analysis is that New Yorkers are more sensitive to changes in travel time than they are to changes in travel cost. The model predicts that the most effective ways to reduce both auto ownership and car commuting involve changing the relative travel times for cars and transit, making transit trips faster by increasing both the frequency and the speed of service and making auto trips slower – perhaps simply by allowing traffic congestion. Population density also appears to have a substantial effect on car ownership in New York.     

A model and algorithm for multicriteria route-mode choice

Using an idea proposed independently by Quandt and Schneider, the paper declares mode choice to be a special instance of route choice. It describes a (non-logit) model which includes in its route-choice mechanism the decision variables traditionally associated with mode choice. With the assumption that each traveller selects the route which minimizes his own personal linear choice function, it is clear that the routes with a nonzero chance of being picked are only those not dominated by any other path (e.g. are not both costlier and longer than any other path). The precise probability of a route being chosen is just the integral over the appropriate portion of the probability density of the coefficients of the choice function. The integration limits are implied by the amount of each disutility on each of the undominated routes. An algorithm is given which is quite efficient in finding these paths in a large and complex multimodal network.     

Fundamentals of discrete multimodal choice modelling

Abstract

In this paper an overview is given of the most relevant issues relating to the application of multimodal choice models, with particular emphasis on disaggregate modal split models. The paper considers questions of data, such as type of data, alternative sampling strategies and problems of measurement; and modelling issues, such as model specification and estimation, including a good presentation of the statistical techniques'available. The paper also addresses the aggregation problem, which lies at the heart of one of today's most hotly contested debates: whether to use aggregate or disaggregate models for policy analysis, and in which circumstances.     

Analysis of dynamic decision-making in a bicycle-sharing auction using a dynamic discrete choice model

For clarifying the usefulness and practical issues of a tradable permit system empirically, we implemented a tradable permit system for a bicycle-sharing service in Yokohama city, Japan. We analyzed both travel and transaction behavior within this system. Many activity factors, such as the amount of free time in each day, home location and travel mode to the bicycle port, were shown to affect the transaction of tradable permits. The results of the pilot program indicated that inefficient allocation of tradable permits occurred when participants postponed their decision-making because of uncertainty. To determine the reason for this effect and the contributing factors, we created a dynamic discrete choice model to describe the choice results and timing. The estimation result indicated that the option value of postponing decision-making caused the transactions to be performed at the last minute, and that this effect blocked the liquidity of the permits trade. In addition, because the result reveals that there was heterogeneity in the time discount factor, the initial allocation of permits was found to be important for efficient allocation.

     

A bi-objective cyclist route choice model

It is widely acknowledged that cyclists choose their route differently to drivers of private vehicles. The route choice decision of commuter drivers is often modelled with one objective, to reduce their generalised travel cost, which is a monetary value representing the combined travel time and vehicle operating cost. Commuter cyclists, on the other hand, usually have multiple incommensurable objectives when choosing their route: the travel time and the suitability of a route. By suitability we mean non-subjective factors that characterise the suitability of a route for cycling, including safety, traffic volumes, traffic speeds, presence of bicycle lanes, whether the terrain is flat or hilly, etc. While these incommensurable objectives are difficult to be combined into a single objective, it is also important to take into account that each individual cyclist may prioritise differently between travel time and suitability when they choose a route.This paper proposes a novel model to determine the route choice set of commuter cyclists by formulating a bi-objective routing problem. The two objectives considered are travel time and suitability of a route for cycling. Rather than determining a single route for a cyclist, we determine a choice set of optimal alternative routes (efficient routes) from which a cyclist may select one according to their personal preference depending on their perception of travel time versus other route choice criteria considered in the suitability index. This method is then implemented in a case study in Auckland, New Zealand.The study provides a starting point for the trip assignment of cyclists, and with further research, the bi-objective routing model developed can be applied to create a complete travel demand forecast model for cycle trips. We also suggest the application of the developed methodology as an algorithm in an interactive route finder to suggest efficient route choices at different levels of suitability to cyclists and potential cyclists.     

About attitudes and perceptions: finding the proper way to consider latent variables in discrete choice models

We provide an in-depth theoretical discussion about the differences between individual-specific latent constructs (representing attitudes, for example, but also other characteristics such as values or personality traits) and alternative-specific latent constructs (that may represent perceptions) affecting the choice-making process of individuals; we also carry out an empirical exercise to analyze their effects. This discussion is of importance, as the majority of papers considering attitudinal latent variables just take these as attributes affecting directly the utility of a certain alternative, while systematic taste variations are rarely considered and perceptions are mostly ignored. The results of our case study show that perceptions may indeed affect the decision making process and that they are able to capture a significant part of the variability that is normally explained by alternative specific constants. Furthermore, our results indicate that attitudes may be a reason for systematic taste variations, and that a proper categorization of latent variables, in accordance with underlying theory, may outperform the customary assumption of linearity.     

A simultaneous destination and mode choice model for shopping trips

This paper describes a disaggregate simultaneous destination and mode choice model for shopping trips. Following an introduction to the model structure and a review of the data, the results of five different model specifications are discussed. The models were estimated using data from two communities adjacent to Eindhoven, the Netherlands and utilise the multinomial logit model.     

A non-compensatory choice model incorporating attribute cutoffs

This research proposes an extension to the traditional compensatory utility maximization framework which has guided most theoretical and statistical work in choice modeling applications, including those in transportation demand estimation work. Attribute cutoffs are incorporated into the decision problem formulation; it is then argued on extant empirical evidence that individuals may view these constraints as “soft”. This leads to the formulation of a penalized utility function that allows for constraint violation, but at a cost to the overall evaluation of the good. The proposed model is able to represent fully compensatory, conjunctive and disjunctive choice strategies, as well as combinations thereof. The properties of the proposed theoretical model are examined and discussed. From the theoretical framework, statistical models of choice behavior are easily derived; in their simplest forms, these models can be estimated using existing software. A Stated Preference choice experiment is analyzed using the proposed model, which is found to be highly consistent with observed choices and superior to a structural two-stage choice set formation model.     

A tour-based model of travel mode choice

This paper presents a new tour-based mode choice model. The model is agent-based: both households and individuals are modelled within an object-oriented, microsimulation framework. The model is household-based in that inter-personal household constraints on vehicle usage are modelled, and the auto passenger mode is modelled as a joint decision between the driver and the passenger(s) to ride-share. Decisions are modelled using a random utility framework. Utility signals are used to communicate preferences among the agents and to make trade-offs among competing demands. Each person is assumed to choose the best combination of modes available to execute each tour, subject to auto availability constraints that are determined at the household level. The households allocations of resources (i.e., cars to drivers and drivers to ride-sharing passengers) are based on maximizing overall household utility, subject to current household resource levels. The model is activity-based: it is designed for integration within a household-based activity scheduling microsimulator. The model is both chain-based and trip-based. It is trip-based in that the ultimate output of the model is a chosen, feasible travel mode for each trip in the simulation. These trip modes are, however, determined through a chain-based analysis. A key organizing principle in the model is that if a car is to be used on a tour, it must be used for the entire chain, since the car must be returned home at the end of the tour. No such constraint, however, exists with respect to other modes such as walk and transit. The paper presents the full conceptual model and estimation results for an initial empirical prototype. Because of the complex nature of the model decision structure, choice probabilities are simulated from direct generation of random utilities rather than through an analytical probability expression.     

A Stated preference freight mode choice model

Transport policy aims to assist the transport system to work more efficiently and effectively. An understanding of the reasons why people choose to move freight in a certain manner is critical to the development of appropriate policies. This article outlines a data collection approach and the development of a disaggregate mode choice model applicable to the analysis of freight shipper decision making. It focuses on the choice between rail and road in Java, Indonesia. The model indicates that safety, reliability and responsiveness are major attributes influencing rail/road freight mode choice. Transport policies aimed at improving these dimensions should increase the attractiveness of rail transport.     

Estimating commuter mode choice: A discrete choice analysis of the impact of road pricing and parking charges

Automobile use leads to external costs associated with emissions, congestion, noise and other impacts. One option for minimizing these costs is to introduce road pricing and parking charges to reduce demand for single occupant vehicle (SOV) use, while providing improvements to alternatives to encourage mode switching. However, the impact of these policies on urban mode choice is uncertain, and results reported from regions where charging has been introduced may not be transferable. In particular, revealed preference data associated with cost recovery tolls on single facilities may not provide a clear picture of driver response to tolls for demand management. To estimate commuter mode choice behaviour in response to such policies, 548 commuters from a Greater Vancouver suburb who presently drive alone to work completed an individually customized discrete choice experiment (DCE) in which they chose between driving alone, carpooling or taking a hypothetical express bus service when choices varied in terms of time and cost attributes. Attribute coefficients identified with the DCE were used in a predictive model to estimate commuter response to various policy oriented combinations of charges and incentives. Model results suggest that increases in drive alone costs will bring about greater reductions in SOV demand than increases in SOV travel time or improvements in the times and costs of alternatives beyond a base level of service. The methods described here provide an effective and efficient way for policy makers to develop an initial assessment of driver reactions to the introduction of pricing policies in their particular regions.     

Global versus localised attitudinal responses in discrete choice

Despite the increasing popularity of including attitudinal and perceptual indicators within discrete choice models, debate endures as to whether there exists a causative relationship between attitudes and behaviour, resulting in what has been termed the attitude behaviour gap. In attempt to understand its origins, attitudes have been categorised as global or localised according to whether or not they are related to a specific time, context and action. Under this framework, global attitudes (GA) typically result in poor predictions of specific overt behaviours, whilst attitudes toward behaviour, or localised attitudes (LA), tend to be better predictors of actual outcomes. Also, attitude strength, measured as the accessibility in memory, plays a determinant role in reducing the gap between attitudes and behaviour, with “memory-based” attitudes having a better prediction of overt behaviours than short-term attitudes constructed “on the spot”. The specific focus of the current paper is to examine the temporal stability and the nature of attitudes, being it critical to transportation planning and research considering the controversial link between attitudes and behaviour. An in depth analysis of the different types of attitudes towards satisfaction for train trips reveals that GAs and LAs provide moderately different outcomes. Also, a memory effect has been found, suggesting the connection between attitudes created on the spot and those stored in memory. Further, both GAs and LAs impact significantly on individual preferences. Finally, the omission of LAs, which are rarely employed within transport literature, may potentially lead to inconsistent estimates, as their contribution in explaining the choice will be absorbed by the error term.