ApolloChoiceModelling forum

During the elasticity analysis using Apollo, I encountered a specific inquiry.

The model under consideration involves four choice sets, comprising three unlabeled alternatives and a no-choice option, with the following utility specification:

alt1 = b0+b1*x1_1+b2*x2_1
alt2 = b0+b1*x1_2+b2*x2_2
alt3 = b0+b1*x1_3+b2*x2_3
no-choice = 0

1. Is classical elasticity analysis suitable for unlabeled cases?
(While computations may be possible, I am interested in ascertaining the theoretical relevance of confirming sensitivity to specific attributes.)

2. If not, what kind of elasticity is appropriate for exploring attribute sensitivity?
(A preliminary consideration involves incrementing each specific attribute of the three unlabeled alternatives by 1% and observing the resultant probability change in the no-choice option. However, does this approach align with theoretical principles?)

3. Additionally, I am employing elasticity analysis code from "Apollo_example_3.r" (from a prior version).
(a) Can we say this is aggregate elasticity, given that it yields an average value across all samples?
(b) Can you say which aggregation method was used?

I eagerly anticipate your valuable insights.

Gratefully,
Doosun Hong

Hi

many apologies for the slow reply, we had missed your post

In relation to your questions:

1. Is classical elasticity analysis suitable for unlabeled cases?
(While computations may be possible, I am interested in ascertaining the theoretical relevance of confirming sensitivity to specific attributes.)

It is not an elasticity per se, but can tell you something about the sensitivity indeed.

2. If not, what kind of elasticity is appropriate for exploring attribute sensitivity?
(A preliminary consideration involves incrementing each specific attribute of the three unlabeled alternatives by 1% and observing the resultant probability change in the no-choice option. However, does this approach align with theoretical principles?)

What you suggest here actually makes sense and could be considered an elasticity as you have a somewhat labelled context given the opt-out. So if you're changing all the other alternatives at the same time, then you're computing an elasticity for the opt-out.

3. Additionally, I am employing elasticity analysis code from "Apollo_example_3.r" (from a prior version).

(a) Can we say this is aggregate elasticity, given that it yields an average value across all samples?

What we do here is an elasticity of demand.

(b) Can you say which aggregation method was used?

summing up of probabilities across observations, then computing the elasticity on the aggregated demands