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Random Utility Model
In economics, a random utility model (RUM), also called stochastic utility model, is a mathematical description of the preferences of a person, whose choices are not deterministic, but depend on a random state variable. Background A basic assumption in classic economics is that the choices of a rational person choices are guided by a Preference (economics), preference relation, which can usually be described by a utility function. When faced with several alternatives, the rational person will choose the alternative with the highest utility. The utility function is not visible; however, by observing the choices made by the person, we can "reverse-engineer" his utility function. This is the goal of revealed preference theory. In practice, however, people are not rational. Ample empirical evidence shows that, when faced with the same set of alternatives, people may make different choices. To an outside observer, their choices may appear random. One way to model this behavior is ca ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Economics
Economics () is a behavioral science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behaviour and interactions of Agent (economics), economic agents and how economy, economies work. Microeconomics analyses what is viewed as basic elements within economy, economies, including individual agents and market (economics), markets, their interactions, and the outcomes of interactions. Individual agents may include, for example, households, firms, buyers, and sellers. Macroeconomics analyses economies as systems where production, distribution, consumption, savings, and Expenditure, investment expenditure interact; and the factors of production affecting them, such as: Labour (human activity), labour, Capital (economics), capital, Land (economics), land, and Entrepreneurship, enterprise, inflation, economic growth, and public policies that impact gloss ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Condorcet's Jury Theorem
Condorcet's jury theorem is a political science theorem about the relative probability of a given group of individuals arriving at a correct decision. The theorem was first expressed by the Marquis de Condorcet in his 1785 work ''Essay on the Application of Analysis to the Probability of Majority Decisions''. The assumptions of the theorem are that a group wishes to reach a decision by majority rule, majority vote. One of the two outcomes of the vote is ''correct'', and each voter has an independent probability ''p'' of voting for the correct decision. The theorem asks how many voters we should include in the group. The result depends on whether ''p'' is greater than or less than 1/2: * If ''p'' is greater than 1/2 (each voter is more likely to vote correctly), then adding more voters increases the probability that the majority decision is correct. In the limit, the probability that the majority votes correctly approaches 1 as the number of voters increases. * On the other hand, if ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Normal Distribution
In probability theory and statistics, a normal distribution or Gaussian distribution is a type of continuous probability distribution for a real-valued random variable. The general form of its probability density function is f(x) = \frac e^\,. The parameter is the mean or expectation of the distribution (and also its median and mode), while the parameter \sigma^2 is the variance. The standard deviation of the distribution is (sigma). A random variable with a Gaussian distribution is said to be normally distributed, and is called a normal deviate. Normal distributions are important in statistics and are often used in the natural and social sciences to represent real-valued random variables whose distributions are not known. Their importance is partly due to the central limit theorem. It states that, under some conditions, the average of many samples (observations) of a random variable with finite mean and variance is itself a random variable—whose distribution c ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Multivariate Probit Model
In statistics and econometrics, the multivariate probit model is a generalization of the probit model used to estimate several correlated binary outcomes jointly. For example, if it is believed that the decisions of sending at least one child to public school and that of voting in favor of a school budget are correlated (both decisions are binary), then the multivariate probit model would be appropriate for jointly predicting these two choices on an individual-specific basis. J.R. Ashford and R.R. Sowden initially proposed an approach for multivariate probit analysis. Siddhartha Chib and Edward Greenberg extended this idea and also proposed simulation-based inference methods for the multivariate probit model which simplified and generalized parameter estimation. Example: bivariate probit In the ordinary probit model, there is only one binary dependent variable Y and so only one latent variable Y^* is used. In contrast, in the bivariate probit model there are two binary dependent ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Independence Of Irrelevant Alternatives
Independence of irrelevant alternatives (IIA) is an axiom of decision theory which codifies the intuition that a choice between A and B (which are both related) should not depend on the quality of a third, unrelated outcome C. There are several different variations of this axiom, which are generally equivalent under mild conditions. As a result of its importance, the axiom has been independently rediscovered in various forms across a wide variety of fields, including economics, cognitive science, social choice, fair division, rational choice, artificial intelligence, probability, and game theory. It is closely tied to many of the most important theorems in these fields, including Arrow's impossibility theorem, the Balinski–Young theorem, and the money pump arguments. In behavioral economics, failures of IIA (caused by irrationality) are called menu effects or menu dependence. Motivation This is sometimes explained with a short story by philosopher Sidney Morgenbesser:Mor ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Gumbel Distribution
In probability theory and statistics, the Gumbel distribution (also known as the type-I generalized extreme value distribution) is used to model the distribution of the maximum (or the minimum) of a number of samples of various distributions. This distribution might be used to represent the distribution of the maximum level of a river in a particular year if there was a list of maximum values for the past ten years. It is useful in predicting the chance that an extreme earthquake, flood or other natural disaster will occur. The potential applicability of the Gumbel distribution to represent the distribution of maxima relates to extreme value theory, which indicates that it is likely to be useful if the distribution of the underlying sample data is of the normal or exponential type. The Gumbel distribution is a particular case of the generalized extreme value distribution (also known as the Fisher–Tippett distribution). It is also known as the ''log-Weibull distribution'' and the ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Logit Model
In statistics, the logit ( ) function is the quantile function associated with the standard logistic distribution. It has many uses in data analysis and machine learning, especially in data transformations. Mathematically, the logit is the inverse of the standard logistic function \sigma(x) = 1/(1+e^), so the logit is defined as : \operatorname p = \sigma^(p) = \ln \frac \quad \text \quad p \in (0,1). Because of this, the logit is also called the log-odds since it is equal to the logarithm of the odds \frac where is a probability. Thus, the logit is a type of function that maps probability values from (0, 1) to real numbers in (-\infty, +\infty), akin to the probit function. Definition If is a probability, then is the corresponding odds; the of the probability is the logarithm of the odds, i.e.: : \operatorname(p)=\ln\left( \frac \right) =\ln(p)-\ln(1-p)=-\ln\left( \frac-1\right)=2\operatorname(2p-1). The base of the logarithm function used is of little import ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Transportation
Transport (in British English) or transportation (in American English) is the intentional Motion, movement of humans, animals, and cargo, goods from one location to another. Mode of transport, Modes of transport include aviation, air, land transport, land (rail transport, rail and road transport, road), ship transport, water, cable transport, cable, pipeline transport, pipelines, and space transport, space. The field can be divided into infrastructure, vehicles, and operations. Transport enables human trade, which is essential for the development of civilizations. Transport infrastructure consists of both fixed installations, including roads, railways, airway (aviation), airways, waterways, canals, and pipeline transport, pipelines, and terminals such as airports, train station, railway stations, bus stations, warehouses, trucking terminals, refueling depots (including fuel docks and fuel stations), and seaports. Terminals may be used both for the interchange of passengers and ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Psychology
Psychology is the scientific study of mind and behavior. Its subject matter includes the behavior of humans and nonhumans, both consciousness, conscious and Unconscious mind, unconscious phenomena, and mental processes such as thoughts, feelings, and motivation, motives. Psychology is an academic discipline of immense scope, crossing the boundaries between the Natural science, natural and social sciences. Biological psychologists seek an understanding of the Emergence, emergent properties of brains, linking the discipline to neuroscience. As social scientists, psychologists aim to understand the behavior of individuals and groups.Hockenbury & Hockenbury. Psychology. Worth Publishers, 2010. A professional practitioner or researcher involved in the discipline is called a psychologist. Some psychologists can also be classified as Behavioural sciences, behavioral or Cognitive science, cognitive scientists. Some psychologists attempt to understand the role of mental functions in i ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Marketing
Marketing is the act of acquiring, satisfying and retaining customers. It is one of the primary components of Business administration, business management and commerce. Marketing is usually conducted by the seller, typically a retailer or manufacturer. Products can be marketed to other businesses (B2B Marketing, B2B) or directly to consumers (B2C). Sometimes tasks are contracted to dedicated marketing firms, like a Media agency, media, market research, or advertising agency. Sometimes, a trade association or government agency (such as the Agricultural Marketing Service) advertises on behalf of an entire industry or locality, often a specific type of food (e.g. Got Milk?), food from a specific area, or a city or region as a tourism destination. Market orientations are philosophies concerning the factors that should go into market planning. The marketing mix, which outlines the specifics of the product and how it will be sold, including the channels that will be used to adverti ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Covariance Structure Modeling
Structural equation modeling (SEM) is a diverse set of methods used by scientists for both observational and experimental research. SEM is used mostly in the social and behavioral science fields, but it is also used in epidemiology, business, and other fields. A common definition of SEM is, "...a class of methodologies that seeks to represent hypotheses about the means, variances, and covariances of observed data in terms of a smaller number of 'structural' parameters defined by a hypothesized underlying conceptual or theoretical model,". SEM involves a model representing how various aspects of some phenomenon are thought to causally connect to one another. Structural equation models often contain postulated causal connections among some latent variables (variables thought to exist but which can't be directly observed). Additional causal connections link those latent variables to observed variables whose values appear in a data set. The causal connections are represented using ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
