Mixed logit with latent variables PreviousNext
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 Heike Link posted on Tuesday, August 12, 2014 - 1:08 am

I have estimated a hybrid discrete choice model which consists of a conventional binary logit model and a latent variable part. Both parts where estimated jointly by using MLR with Monte Carlo simulation. The structure of my model is below:

Y ON x1-x5 (Y is a binary variable, x1-x5 are continuous predictors)
LV1 BY i1 i2 (i1 and i2 are continuous indicators)
x6 x7 ON LV1 (x6, x7 are exogenous variables, continuos)
LV2 BY i3 i4 i5 i6 (i3 i6 are categorical indicators)
x8 x9 ON LV2 (x8, x9 are exogenous variables, continuous)

The model was aimed at providing a better explanation of Y by including latent variables and this worked out well, the parameters are significant and can well be interpreted.

I am now asked by a referee to introduce unobserved consumer heterogeneity. This means that I need to estimate a Mixed Logit model by allowing some parameters to be random, based on assumed heterogeneity distributions such as normal or lognormal.

Does Mplus allow estimating a Mixed Logit model which contains also the latent variable part as my model above? Is it possible, for example, to estimate random parameters for Y ON x1-x5 within the hybrid model listed above?

Many thanks for your clarification.

 Bengt O. Muthen posted on Tuesday, August 12, 2014 - 2:49 pm
If the random effect parameters are identified they can be estimated in Mplus. For example, to add a normally distributed random intercept for Y, just say

f BY y;

which means that f is the random intercept and its variance is the variance of f.

Our website has related discrete-choice papers posted under Papers, Miscellaneous, such as

Temme, D., Paulssen, M., & Dannewald, T. (2008). Incorporating latent variables into discrete choice models A simultaneous estimation approach using SEM software. BuR Business Research, 1, 220-237.
download paper contact first author show abstract
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