Date of this Version
10-1-1990
Document Type
Discussion Paper
Abstract
Probabilistic conjoint choice simulators based on Luce's choice axiom (BTL or Multinomial Logit simulators) suffer from the Independence from Irrelevant Alternatives (IIA) property. This is not very realistic in many real situations where some products are more similar to one of the alternatives than to others. A Multinomial Probit (MNP) choice simulator is proposed which allows for correlated alternatives to exist in a simulated market. The MNP simulator is illustrated with an empirical example and contrasted with results from a logit simulator.
COinS
Publication Details
Lester W. Johnson (1990) A Multinomial Probit Conjoint Simulator
School of Business Discussion Paper ; No. 9, Oct. 1990
© Copyright Lester W. Johnson and the School of Business, Bond University