Environmental and Resource Economics

, Volume 50, Issue 1, pp 83–110 | Cite as

A Joint Latent-Class Model: Combining Likert-Scale Preference Statements With Choice Data to Harvest Preference Heterogeneity

  • William S. Breffle
  • Edward R. Morey
  • Jennifer A. Thacher


In addition to choice questions (revealed and stated choices), preference surveys typically include other questions that provide information about preferences. Preference-statement data include questions on the importance of different attributes of a good or the extent of agreement with a particular statement. The intent of this paper is to model and jointly estimate preference heterogeneity using stated-preference choice data and preference-statement data. The starting point for this analysis is the belief that the individual has preferences, and both his/her choices and preference statements are manifestations of those preferences. Our modeling contribution is linking the choice data and preference-statement data in a latent-class framework. Estimation is straightforward using the E-M algorithm, even though our model has hundreds of preference parameters. Our estimates demonstrate that: (1) within a preference class, the importance anglers associate with different Green Bay site characteristics is in accordance with their responses to the preference statements; (2) estimated across-class utility parameters for fishing Green Bay are affected by the preference-statement data; (3) estimated across-class preference-statement response probabilities are affected by the inclusion of the choice data; and (4) both data sets influence the number of classes and the probability of belonging to a class as a function of the individual’s type.


Latent class E-M algorithm Choice data Preference statements Likert-scale Preferences Heterogeneity 


E-M algorithm

Expectation-maximization algorithm




Fish consumption advisory


Marginal willingness-to-pay


Stated preference


Revealed preference


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Copyright information

© Springer Science+Business Media B.V. 2011

Authors and Affiliations

  • William S. Breffle
    • 1
  • Edward R. Morey
    • 2
  • Jennifer A. Thacher
    • 3
  1. 1.School of Business and EconomicsMichigan Technological UniversityHoughtonUSA
  2. 2.Department of EconomicsUniversity of Colorado-BoulderBoulderUSA
  3. 3.Department of EconomicsUniversity of New MexicoAlbuquerqueUSA

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