We study nonparametric identification of single-agent discrete choice models for bundles and binary games of complete information. We provide conditions under which we can recover both the interaction effects and the distributions of potentially correlated unobservables across goods in single-agent models and across players in games. We establish similarities in identification between these two models. Strengthening our assumptions for games, we provide an equivalence relation between discrete choice models for bundles and binary games that relies on the theory of potential games. Potential games are particularly useful for games of three or more players.
Authors
Associate Professor Rice University
Natalia Lazzati
Working Paper details
- DOI
- 10.1920/wp.cem.2013.0413
- Publisher
- IFS
Suggested citation
Fox, J and Lazzati, N. (2013). Identification of discrete choice models for bundles and binary games. London: IFS. Available at: https://ifs.org.uk/publications/identification-discrete-choice-models-bundles-and-binary-games (accessed: 3 May 2024).
Related documents
More from IFS
Understand this issue
Where next for the state pension?
13 December 2023
Social mobility and wealth
12 December 2023
Autumn Statement 2023: IFS analysis
23 November 2023
Policy analysis
Recent trends in and the outlook for health-related benefits
19 April 2024
Progression of nurses within the NHS
12 April 2024
Regional variation in earnings and the retention of NHS staff in Agenda for Change bands 1 to 4
10 April 2024
Academic research
Police infrastructure, police performance, and crime: Evidence from austerity cuts
24 April 2024
Imagine your life at 25: Gender conformity and later-life outcomes
24 April 2024
A senior doctor like me: Gender match and occupational choice
24 April 2024