Applied Choice Analysis: A Primer
Abstract
Almost without exception, everything human beings undertake involves a choice. In recent years there has been a growing interest in the development and application of quantitative statistical methods to study choices made by individuals with the purpose of gaining a better understanding both of how choices are made and of forecasting future choice responses. In this primer the authors provide an unintimidating introduction to the main techniques of choice analysis and include detail on themes such as data collection and preparation, model estimation and interpretation and the design of choice experiments. A companion website to the book provides practice data sets and software to estimate the main discrete choice models such as multinomial logit, nested logit and mixed logit. This primer will be an invaluable resource to students as well as of immense value to consultants and professionals, researchers and anyone else interested in choice analysis and modelling.
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The DCE was designed and implemented following recommended guidelines.
“We followed recommended guidelines to design and implement the DCE. [7, 8, 11–16]”
From Assessing the American public's preferences for reforms to teen driving licensure systems: a discrete choice experiment (2026) · cites this paper as [14]
Key results were presented and interpreted for the MIXL models based on goodness of fit statistics.
“Key results are presented and interpreted for the MIXL models (Model 3 and Model 4), based on goodness of fit statistics (McFadden pseudo-R-squared, Akaike and Bayesian information criteria).”
From Assessing the American public's preferences for reforms to teen driving licensure systems: a discrete choice experiment (2026) · cites this paper as [14]
The DCE data were analysed using a mixed-logit model (MMNL), which offers advantages over the more often used multinominal logit (MNL).
“Here, we use a mixed-logit model (MMNL) which offers advantages to the more often used multinominal logit (MNL) [32,33].”
From Consumer preferences for teledermoscopy screening to detect melanoma early (2016) · cites this paper as [33]
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“Furthermore, the same methods for analysing DCE data apply irrespective of the study context and are well documented elsewhere (Louviere et al. 2000; Hensher et al. 2005).”
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“This is an important distinction since it is impossible to establish, for each individual, their unique set of estimates; instead, a mean, and standard deviation, estimate for the subpopulation who made the same set of choices in the panel was derived (Hensher et al, 2005).”
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“While RU1 can be used to identify one of the dissimilarity parameters, it should be normalized to 1 (see Hensher et al., 2005).”
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“Formally, in the LCM employed here, the utility that farmer i, who belongs to a particular segment s, derives from choosing milpa alternative 3 See Louviere et al. (2000), Bennett and Blamey (2001) and Hensher et al. (2005), for an introduction to the choice experiment method.”
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“The DCE design has shortcomings: at the time we began our study, the experimental design was consistent with prevailing guidance (Hensher et al. 2005) and published studies (Scott et al. 2003; Hanson et al. 2005).”
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“More recently, choice experiments (CE) have gained in popularity as an alternative to CV (e.g. Hanley et al. 1998, Hensher et al. 2005, Hanley et al. 2006).”
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“A stated choice (SC) experiment is developed in which we systematically vary combinations of levels of each attribute to reveal new opportunities relative to the existing circumstance of time-cost-service level on offer (see Hensher 1994; Louviere et al. 2000; Hensher et al. 2005; Rose et al. 2008).”
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“CM is consistent with random utility theory (RUT) (see Hensher et al., 2005 for detailed discussions).”
BackgroundMethodInfluentialPatients’ preferences: a discrete-choice experiment for treatment of non-small-cell lung cancer
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Design and Analysis of Choice Experiments Using R: A Brief Introduction
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“Although based on stated preferences its trade-off design resembles real life decision making better than ranking and rating techniques and can be useful for policy analysis and planning when choices cannot be observed from revealed preferences (Hensher et al. 2005; Train 2009).”
Greiner, R. (2015) · Australian Journal of Agricultural and Resource Economics · doi:10.1111/1467-8489.12098 · Cited by 95 · see citing works
“Choice experiments are based on the presumption that participants evaluate the alternatives presented to them in a choice task by choosing the alternative (among those presented in the task), which gives the greatest relative utility (Hensher et al. 2005).”
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“Thus the coefficient for each omitted category is the negative sum of the included categories and the mean effect is 0 (Bech and Gyrd-Hansen, 2005; Hensher et al., 2005).”
BackgroundNihonsugi, T., Ihara, A. S., & Haruno, M. (2015) · Journal of Neuroscience · doi:10.1523/jneurosci.3885-14.2015 · Cited by 91 · see citing works
Patients’ and urologists’ preferences for prostate cancer treatment: a discrete choice experiment
de Bekker-Grob, E. W., Bliemer, M. C. J., Donkers, B., Essink‐Bot, M., Korfage, I. J., Roobol, M. J., Bangma, C. H., & Steyerberg, E. W. (2013) · British Journal of Cancer · doi:10.1038/bjc.2013.370 · Cited by 93 · see citing works
“As such, we further blocked the design into two versions of questionnaires containing 12 choice sets each (Hensher et al, 2005).”
BackgroundMethodArnberger, A., & Eder, R. (2011) · Journal of Environmental Planning and Management · doi:10.1080/09640568.2010.539875 · Cited by 92 · see citing works
“Such alternatives – in this case trail scenarios – are defined as combinations of factors (Hensher et al. 2005).”
BackgroundTong, A., Manns, B., Hemmelgarn, B. R., Wheeler, D. C., Tugwell, P., Winkelmayer, W. C., Biesen, W. V., Crowe, S., Kerr, P. G., Polkinghorne, K. R., et al. (2015) · Trials · doi:10.1186/s13063-015-0895-7 · Cited by 92 · see citing works
- Authors
- Hensher, D. A., Rose, J. M., & Greene, W. H.
- Affiliations
- The University of Sydney (AU)
- New York University (US)
- Venue
- Cambridge University Press eBooks
- Publisher
- Cambridge University Press
- Published
- 2005-06-02
- OpenAlex
- W3152367353
- Cited by
- 1,823
- References
- 0
- Citations by year
- 2026: 62 · 2025: 87 · 2024: 104 · 2023: 94 · 2022: 104 · 2021: 121 · 2020: 109 · 2019: 127 · 2018: 95 · 2017: 92 · 2016: 105 · 2015: 136 · 2014: 103 · 2013: 95 · 2012: 98
- FWCI
- 34.17
- Type
- book
- Language
- en
- Open access
- closed
- Locations
- Cambridge University Press eBooks (publishedVersion)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic and Environmental Valuation
- Social Sciences › Decision Sciences › General Decision Sciences › Decision-Making and Behavioral Economics
- Social Sciences › Transportation › Transportation Planning and Optimization
- Keywords
- discrete choice models, multinomial logistic regression, nested logit model, mixed logit, discrete choice experiment, choice experiment design
About these checks
Registry, retraction, Cites and statistics results are computed, not judged, with one exception: a printed reference that no index lists is read once by a model before it counts as a citation error. Claims are extracted by a model and kept only when their quote appears verbatim in the text; each cited source is then checked, with a model’s help, for whether it says what the claim relies on. Those verdicts can be wrong — read the claim’s quote and the cited source before relying on one.
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