Regret minimisation and utility maximisation in a freight transport context

Marco Boeri*, Lorenzo Masiero

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

27 Citations (Scopus)
353 Downloads (Pure)

Abstract

This study is the first to compare random regret minimisation (RRM) and random utility maximisation (RUM) in freight transport application. This paper aims to compare RRM and RUM in a freight transport scenario involving negative shock in the reference alternative. Based on data from two stated choice experiments conducted among Swiss logistics managers, this study contributes to related literature by exploring for the first time the use of mixed logit models in the most recent version of the RRM approach. We further investigate two paradigm choices by computing elasticities and forecasting choice probability. We find that regret is important in describing the managers’ choices. Regret increases in the shock scenario, supporting the idea that a shift in reference point can cause a shift towards regret minimisation. Differences in elasticities and forecast probability are identified and discussed appropriately.

Original languageEnglish
Pages (from-to)548-560
Number of pages13
JournalTransportmetrica A: Transport Science
Volume10
Issue number6
Early online date26 Jun 2013
DOIs
Publication statusPublished - 2014

Keywords

  • freight transport
  • random regret minimisation
  • random utility maximisation
  • shift of reference point
  • stated preference

ASJC Scopus subject areas

  • Engineering(all)
  • Transportation

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