A Travel Decision Making Model Based on Nested Logit Model Considering Bounded Rationality

In this study, a Boundedly Rational Nested Logit (BRNL) model is proposed by introducing the concept of indifference threshold into Nested Logit (NL) model. In BRNL model, the traveler is assumed to choose randomly or in accordance with his preference if the expected cost difference between two alternatives is within the indifference band. Otherwise, the traveler will choose the alternative with the minimum expected cost. A nested method of successive average is developed to solve the proposed problem. Finally, the rationality of the model and effectiveness of the algorithm are proved by using a numerical example with three-mode transportation network. The results indicate that, different from NL model, the choices of the travelers in BRNL model do not depend on the costs always. The value of the indifference threshold will affect the choice probability. The larger the indifference threshold is, the less sensitive travelers are to the change of cost. In particular, if the indifference threshold is large enough, the travelers’ choices will always depend on the preference.