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Status quo effect and preferences uncertainty: A Heteroscedastic Extreme Value (HEV) model

Analysts must include the status quo (SQ) option as one of the alternatives in the Choice Experiments (CE) technique to ensure the technique is consistent with the Hicksian welfare analysis. However, it comes at a price.Usually, respondents choose the option not because it provides the highest util...

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Main Authors: Hasan Basri, Bakti, Yahya, Nurul Huda, Musa, Rusmani
Format: Article
Language:English
Published: Universiti Kebangsaan Malaysia 2013
Subjects:
HG Finance
Online Access:http://repo.uum.edu.my/14856/1/jeko_47%281%29-16.pdf
http://repo.uum.edu.my/14856/
http://www.ukm.my/fep/jem/pdf/2013-47(1)/jeko_47(1)-16.pdf
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spelling my.uum.repo.148562016-04-18T04:04:52Z http://repo.uum.edu.my/14856/ Status quo effect and preferences uncertainty: A Heteroscedastic Extreme Value (HEV) model Hasan Basri, Bakti Yahya, Nurul Huda Musa, Rusmani HG Finance Analysts must include the status quo (SQ) option as one of the alternatives in the Choice Experiments (CE) technique to ensure the technique is consistent with the Hicksian welfare analysis. However, it comes at a price.Usually, respondents choose the option not because it provides the highest utility but to avoid making difficult decisions or to protest the attributes trade-off. One solution for investigating the effect of the SQ option is through the inclusion of the alternative specific constant (ASC) in an estimation model.However, the solution is not applicable for an estimation model that has no ASC.In the present study, the heteroscedastic extreme value (HEV) model is applied to investigate the affect of the SQ effect on preference uncertainty.By analysing respondents’ preferences relating to attributes at recreational parks, the results suggest that more uncertainty exists in the SQ option, while less uncertainty exists in the hypothetical alternatives. Universiti Kebangsaan Malaysia 2013 Article PeerReviewed application/pdf en http://repo.uum.edu.my/14856/1/jeko_47%281%29-16.pdf Hasan Basri, Bakti and Yahya, Nurul Huda and Musa, Rusmani (2013) Status quo effect and preferences uncertainty: A Heteroscedastic Extreme Value (HEV) model. Jurnal Ekonomi Malaysia, 47 (1). pp. 163-172. ISSN 0126-1962 http://www.ukm.my/fep/jem/pdf/2013-47(1)/jeko_47(1)-16.pdf
institution Universiti Utara Malaysia
building UUM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Utara Malaysia
content_source UUM Institutionali Repository
url_provider http://repo.uum.edu.my/
language English
topic HG Finance
spellingShingle HG Finance
Hasan Basri, Bakti
Yahya, Nurul Huda
Musa, Rusmani
Status quo effect and preferences uncertainty: A Heteroscedastic Extreme Value (HEV) model
description Analysts must include the status quo (SQ) option as one of the alternatives in the Choice Experiments (CE) technique to ensure the technique is consistent with the Hicksian welfare analysis. However, it comes at a price.Usually, respondents choose the option not because it provides the highest utility but to avoid making difficult decisions or to protest the attributes trade-off. One solution for investigating the effect of the SQ option is through the inclusion of the alternative specific constant (ASC) in an estimation model.However, the solution is not applicable for an estimation model that has no ASC.In the present study, the heteroscedastic extreme value (HEV) model is applied to investigate the affect of the SQ effect on preference uncertainty.By analysing respondents’ preferences relating to attributes at recreational parks, the results suggest that more uncertainty exists in the SQ option, while less uncertainty exists in the hypothetical alternatives.
format Article
author Hasan Basri, Bakti
Yahya, Nurul Huda
Musa, Rusmani
author_facet Hasan Basri, Bakti
Yahya, Nurul Huda
Musa, Rusmani
author_sort Hasan Basri, Bakti
title Status quo effect and preferences uncertainty: A Heteroscedastic Extreme Value (HEV) model
title_short Status quo effect and preferences uncertainty: A Heteroscedastic Extreme Value (HEV) model
title_full Status quo effect and preferences uncertainty: A Heteroscedastic Extreme Value (HEV) model
title_fullStr Status quo effect and preferences uncertainty: A Heteroscedastic Extreme Value (HEV) model
title_full_unstemmed Status quo effect and preferences uncertainty: A Heteroscedastic Extreme Value (HEV) model
title_sort status quo effect and preferences uncertainty: a heteroscedastic extreme value (hev) model
publisher Universiti Kebangsaan Malaysia
publishDate 2013
url http://repo.uum.edu.my/14856/1/jeko_47%281%29-16.pdf
http://repo.uum.edu.my/14856/
http://www.ukm.my/fep/jem/pdf/2013-47(1)/jeko_47(1)-16.pdf
_version_ 1644281564171862016
score 13.211869

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