LATENT CHANGE IN RECURRENT CHOICE DATA

This paper introduces dynamic latent-class models for the analysis and interpretation of stability and change in recurrent choice data. Thes e latent-class models provide a nonparametric representation of indivi dual taste differences. Changes in preferences are modeled by allowing for individual-level transitions from one latent class to another ove r time. The most general model facilitates a saturated representation of class membership changes. Several special cases are presented to ob tain a parsimonious description of latent change mechanisms. An easy t o implement EM algorithm is derived for parameter estimation. The appr oach is illustrated by a detailed analysis of a purchase incidence dat a set.