1 Department of Transport, Technical University of Denmark2 Traffic modelling and planning, Department of Transport, Technical University of Denmark3 Department of Management Engineering, Technical University of Denmark4 KTH - Royal Institute of Technology5 École Polytechnique Fédérale de Lausanne
The influence of habits, giving rise to inertia effect, in the choice process has been intensely debated in the literature. Typically inertia is accounted for by letting the indirect utility functions of the alternatives of the choice situation at time t depend on the outcome of the choice made at a previous point in time. However, according to the psychological literature, inertia is the results of a habit, which is formed in a longer process where many past decisions (not only the immediately previous one) remain in the memory of the consumer and influence behavior. In this study we use panel data gathered over a continuous period of time, six weeks, to study both inertia and the influence of habits. Tendency to stick with the same alternative is measured through lagged variables that link the current choice with the previous trip made with the same purpose, mode and time of day. However, the lagged effect of the previous trips is not constant but it depends on the individual propensity to undertake habitual trips which is captured by the individual specific latent variable. And the frequency of the trips in the previous week is used as an indicator of the habitual behavior. The model estimation confirms that the tendency to stick with the same alternative varies not only among modes but also across individuals as a function of the individual propensity to undertake habitual behavior.