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Multivariate ordered discrete response models

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  • Tatiana Komarova
  • William Matcham
Abstract
We introduce multivariate ordered discrete response models with general rectangular structures. From the perspective of behavioral economics, these non-lattice models correspond to broad bracketing in decision making, whereas lattice models, which researchers typically estimate in practice, correspond to narrow bracketing. In these models, we specify latent processes as a sum of an index of covariates and an unobserved error, with unobservables for different latent processes potentially correlated. We provide conditions that are sufficient for identification under the independence of errors and covariates and outline an estimation approach. We present simulations and empirical examples, with a particular focus on probit specifications.

Suggested Citation

  • Tatiana Komarova & William Matcham, 2022. "Multivariate ordered discrete response models," Papers 2205.05779, arXiv.org, revised Mar 2023.
    • Handle: RePEc:arx:papers:2205.05779
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    References listed on IDEAS

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