Nonconstant marginal utility
Posted: Fri Mar 27, 2009 10:06 pm
It is not quite clear to me if by specifying an attribute in utility function to be e.g.
What I mean is: if I would like to have dummy-coded attribute levels (to allow for different marginal utilities of increases of its levels) is the above specification ok, or should I rather specify the utility function as:
Am I right that in my case the second specifications is correct if I want to estimate separate parameters for all attribute levels?
Also, this second specification does not seem to work with orthogonal designs (conditions). How to work around it?
- Code: Select all
a1*A[0,1,2,3]
What I mean is: if I would like to have dummy-coded attribute levels (to allow for different marginal utilities of increases of its levels) is the above specification ok, or should I rather specify the utility function as:
- Code: Select all
...
;cond:
if(alt1.A1=1,alt1.A2=0 and alt1.A3=0) ,
if(alt1.A2=2,alt1.A1=0 and alt1.A3=0) ,
if(alt1.A3=3,alt1.A1=0 and alt1.A2=0)
; model:
...
U(alt1) = ... + a1*A1[0,1]+a2*A2[0,2]+a3*A3[0,3] + ... /
...
Am I right that in my case the second specifications is correct if I want to estimate separate parameters for all attribute levels?
Also, this second specification does not seem to work with orthogonal designs (conditions). How to work around it?