Estimating dynamic discrete choice models with hyperbolic discounting, with an application to mammography decisions. (English) Zbl 1404.91070
Summary: We extend the semiparametric estimation method for dynamic discrete choice models using V. J. Hotz and R. A. Miller’s [Rev. Econ. Stud. 60, No. 3, 497–529 (1993; Zbl 0788.90007)] conditional choice probability approach to the setting where individuals may have hyperbolic discounting time preferences and may be naive about their time inconsistency. We illustrate the proposed identification and estimation method with an empirical application of adult women’s decisions to undertake mammography to evaluate the importance of present bias and naivety in the underutilization of this preventive health care. Our results show evidence for both present bias and naivety.
MSC:
| 91B06 | Decision theory |
| 91B08 | Individual preferences |
| 92C50 | Medical applications (general) |
| 62G05 | Nonparametric estimation |
| 62P25 | Applications of statistics to social sciences |
Keywords:
mammography decisions; semiparametric estimation; dynamic discrete choice models; conditional choice probability approachCitations:
Zbl 0788.90007References:
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