A Warning on the Use of Linear Logit Models in Transport Mode Choice Studies
Volume: Volume 10, No. 1
Issue: Spring 1979
Pages: pp. 374-388
Authors: Tae Hoon Oum
Title: A Warning on the Use of Linear Logit Models in Transport Mode Choice Studies
Abstract: This article argues that linear logit models are inappropriate to use for transport demand studies, because they impose many rigid a priori restrictions on the parameters of price responsiveness of demand, such as the elasticities of substitution and cross price elasticities, and the structure of technology (or preference) underlying the linear logit models has severe irregularity and inconsistency. This has a serious implication for the credibility of the findings of several recent studies which attempted to measure the welfare loss of traffic misallocation attributable to the Interstate Commerce Commission's railroad minimum rate regulation.
JEL Classification
Economics of Transportation (6150)