Discrete Choice - Applications

Applications

• Marketing researchers use discrete choice models to study consumer demand and to predict competitive business responses, enabling choice modelers to solve a range of business problems, such as pricing, product development, and demand estimation problems.
• Transportation planners use discrete choice models to predict demand for planned transportation systems, such as which route a driver will take and whether someone will take rapid transit systems. The first applications of discrete choice models were in transportation planning, and much of the most advanced research in discrete choice models is conducted by transportation researchers.
• Energy forecasters and policymakers use discrete choice models for households’ and firms’ choice of heating system, appliance efficiency levels, and fuel efficiency level of vehicles.
• Environmental studies utilize discrete choice models to examine the recreators’ choice of, e.g., fishing or skiing site and to infer the value of amenities, such as campgrounds, fish stock, and warming huts, and to estimate the value of water quality improvements.
• Labor economists use discrete choice models to examine participation in the work force, occupation choice, and choice of college and training programs.