Modeling unobserved heterogeneity using finite mixture random parameters for spatially correlated discrete count data

Road segments with identical site-specific attributes often exhibit significantly different crash counts due to unobserved reasons. The extent of unobserved heterogeneity associated with a road feature is to be estimated prior to selecting the relevant safety treatment. Moreover, crash count data is often over-dispersed and spatially correlated. This paper proposes a spatial negative binomial specification with random parameters for modeling crash counts of contiguous road segments. The unobserved heterogeneity is incorporated using a finite multi-variate normal mixture prior on the random parameters; this allows for non normality, skewness in the distribution of the random parameters, facilitates correlation across the random parameters, and relaxes any distributional assumptions. The model extracts the inherent groups of road segments with crash counts that are equally sensitive to the road attributes on an average; the heterogeneity within these groups is also allowed in the proposed framework. The specification simultaneously accounts for potential spatial correlation of the crash counts from neighboring road segments. A Gibbs sampling framework is proposed that leverages recent theoretical developments on data-augmentation algorithms, and elegantly sidesteps many of the computational difficulties usually associated with Bayesian inference of count models. Empirical results suggests the presence of two latent groups and spatial correlation within the study road network. Road features with significantly different effect on crash counts across two latent groups of road segments were identified. (C) 2016 Elsevier Ltd. All rights reserved.