Context-Dependent Heterogeneous Preferences: A Comment on Barseghyan and Molinari (2023)

Abstract–

Barseghyan and Molinari give sufficient conditions for semi-nonparametric point identification of parameters of interest in a mixture model of decision-making under risk, allowing for unobserved heterogeneity in utility functions and limited consideration. A key assumption in the model is that the heterogeneity of risk preferences is unobservable but context-independent. In this comment, we build on their insights and present identification results in a setting where the risk preferences are allowed to be context-dependent.

KEYWORDS:

• Discrete choice
• Random limited consideration
• Random utility
• Semi-nonparametric identification

Acknowledgments

We thank Francesca Molinari and the participants at the 2023 ASSA meetings (JBES Session: Risk Preference Types, Limited Consideration, and Welfare) for comments.

Disclosure Statement

The authors report there are no competing interests to declare.

Additional information

Funding

Cattaneo gratefully acknowledges financial support from the National Science Foundation through grants SES-1947805 and SES-2241575.