The Effect of Learning and Fatigue on Preferences and WTP in a ...

Note: ASC is the alternative specific constant for the status quo alternative. LL refers to the final log-likelihood <strong>and</strong> adj.
Rho-square refers to the adjusted Likelihood Ratio Index. Because the discrete variables are effect coded, the non-price
attribute-coefficients have been multiplied by two, to account for the fact that the reference level is assigned a value <strong>of</strong>
-1 instead <strong>of</strong> 0 (Bech & Gyrd-Hansen 2005).
a <strong>The</strong> t-value for the scale factor is a t-value tested against the null hypothesis H 0 : σ =1.
Almost all attribute variables show a statistical significant effect on the choice probabilities, with
the exception <strong>of</strong> the ASC in model (i) <strong>and</strong> the st<strong>and</strong>ard deviation <strong>of</strong> the Campylobacter-free label in
models (i) <strong>and</strong> (ii). With adjusted rho-square values <strong>of</strong> above 0.256, all models describe the
variation in the data very well (Domencich & McFadden 1975; Louviere et al. 2000). It is however
clear from the adjusted rho-square measures that the models based on all 16 CS perform much
better than the models based on only 8 CS. Interestingly, Model (ii) obtains a markedly higher
adjusted rho-square than Model (i). <strong>The</strong> fact that the model based on the last 8 CS obtains a higher
degree <strong>of</strong> estimation precision than the model based on the first 8 CS provides a first indication <strong>of</strong>
learning effects taking place.
<strong>The</strong> effect <strong>of</strong> repeating the choice set sequence is initially examined through a likelihood ratio test
for equality <strong>of</strong> model parameters (Louviere & Swait 1993). <strong>The</strong> test results are displayed in table 3.
<strong>The</strong> null hypothesis is that scale adjusted parameters are stable across the first 8 CS <strong>and</strong> the last 8
CS. First we look at the two models based on the first 8 CS <strong>and</strong> the last 8 CS, <strong>and</strong> a pooled model,
which is not corrected for the scaling effect. <strong>The</strong> test returns a test value at 1290, which clearly
suggests that the hypothesis <strong>of</strong> equal parameters in the two models can be rejected at the st<strong>and</strong>ard
5% level <strong>of</strong> statistical significance. <strong>The</strong> differences in parameter values between the two models
might be caused by differences in the underlying scale <strong>of</strong> utility <strong>and</strong> not due to differing preference
structures (Swait & Louviere 1993, Train 2003). Thus, we estimate a pooled model accounting for
different scales <strong>of</strong> utility across the two models <strong>and</strong> run the test again.
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