A dynamic discrete-continuous choice model of car ownership, usage and fuel type

We formulate a dynamic discrete-continuous choice model (DDCCM) of car ownership, usage and fuel type. The framework embeds a discrete-continuous choice model (DCCM) into a dynamic programming (DP) framework to account for the forward-looking behavior of households in the context of car acquisition. More specifically, we model the of transaction type, the choice of fuel type, the ownership status (private versus company car), the choice of car state (new versus secondhand) and the annual driving distance for up to two cars in the household fleet. In this paper, we present the methodological framework and demonstrate the applicability of such a model by showing a concrete example of application.