糖心TV

Organisers: Mingli Chen and Giovanni Ricco

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 Abstract: This paper is concerned with learning decision makers鈥� (DMs) preferences using data on observed choices from a finite set of risky alternatives with monetary outcomes. We propose a discrete choice model with unobserved heterogeneity in consideration sets (the collection of alternatives considered by DMs) and unobserved heterogeneity in standard risk aversion. In this framework, stochastic choice is driven both by different rankings of alternatives induced by unobserved heterogeneity in risk preferences and by different sets of alternatives considered. We obtain sufficient conditions for semi- nonparametric point identification of both the distribution of unobserved heterogeneity in preferences and the distribution of consideration sets. Our method yields an estimator that is easy to compute and that can be used in markets with a large number of alternatives. We apply our method to a dataset on property insurance purchases. We find that although households are on average strongly risk averse, they consider lower coverages more frequently than higher coverages. Finally, we estimate the monetary losses associated with limited consideration in our application.

Coauthors: Levon Barseghyan (Cornell) and Matthew Thirkettle (Cornell)

Title: Vehicle Import Restrictions to Curb Emissions: Evidence from Uganda鈥� (joint work with Dorothy Nakyambadde)

Abstract: Old motor vehicles are major contributors to pollution in developing countries. In an effort to curb emissions, governments, especially in Africa, have increasingly employed import restrictions on vehicles over a certain age threshold. This paper investigates the effectiveness of such strategies in the context of a policy interventions targeting old vehicles in Uganda: an import levy increase in 2015. Combining administrative data on vehicle imports and registrations with information on domestic prices, we estimate the impact of this intervention. We find that, while the policy reduces vehicle imports in the target groups, consumers tend to substitute to old vehicles on the domestic secondary market and/or extend the useful life of currently held vehicles. These findings caution against the use of import restrictions in an effort to curb emissions, absent any regulation of old vehicles available domestically.

This is part of the CRETA Seminar Series.

Seminar organisers: Sinem Hidir and Costas Cavounidis

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