| Summary: | This paper builds a meta-model of vehicle ownership choice parameters to predict how their values might vary across extended periods as a function of macroeconomic variables. Multinomial logit models of vehicle ownership are estimated from repeated cross-sectional data between 1971 and 1996 for large urban centers in Ontario. Three specifications are tested: a varying constants (VC) model where the alternative specific constants are allowed to vary each year; a varying scales (VS) model where the scale parameter varies instead; and a varying scales and constants model. The estimated parameters are then regressed on macroeconomic variables (e.g., employment rate, gas prices, etc.). The regressions yield good fit and statistically significant results, suggesting that changes in the macroeconomic environment influence household decision making over time, and that macroeconomic information could potentially help predict how model parameters evolve. This implies that the common assumption of holding parameters constant across forecast horizons could potentially be relaxed. Furthermore, using a separate validation dataset, the predictive power of the VC and VS models outperform conventional approaches providing further evidence that pooling data from multiple periods could also produce more robust models.
|
|---|
