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Relative Utility Modelling

Bounded Rational Choice Behaviour: Applications in Transport

ISBN: 978-1-78441-072-8, eISBN: 978-1-78441-071-1

Publication date: 31 January 2015



The chapter outlines the principles underlying relative utility models, discusses the results of empirical applications and critically assesses the usefulness of this specification against commonly used random utility models and other context dependence models. It also discusses how relative utility can be viewed as a generalisation of context dependency.


In contrast to the conventional concept of random utility, relative utility assumes that decision-makers derive utility from their choices relative to some threshold(s) or reference points. Relative utility models thus systematically specify the utility against such thresholds or reference points.


Examples in the chapter show that relative utility model perform well in comparison to conventional utility-maximising models in some circumstances.

Originality and value

Examples of relative utility models are rare in transportation research. The chapter shows that several recent models can be viewed as special cases of relative utility models.




This research was supported by the Grants-in-Aid for Scientific Research (A) (No. 22246068) of the Japan Society for the Promotion of Science (JSPS), Japan.


Zhang, J. (2015), "Relative Utility Modelling", Rasouli, S. and Timmermans, H. (Ed.) Bounded Rational Choice Behaviour: Applications in Transport, Emerald Group Publishing Limited, Leeds, pp. 49-71.



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