On the representation of the nested logit model
Statistics Theory
2023-01-31 v6 Probability
Statistics Theory
Abstract
We give a two-line proof of a long-standing conjecture of Ben-Akiva and Lerman (1985) regarding the random utility representation of the nested logit model, thus providing a renewed and straightforward textbook treatment of that model. As an application, we provide a closed-form formula for the correlation between two Fr\'echet random variables coupled by a Gumbel copula.
Cite
@article{arxiv.1907.08766,
title = {On the representation of the nested logit model},
author = {Alfred Galichon},
journal= {arXiv preprint arXiv:1907.08766},
year = {2023}
}