Estimated parameters of simplified versions of the model are shown as versions 3 and 4. The only estimated parameter in model 3 is the variance ฮ. Yet judging by the large difference in the likelihood values the option value model fits the data much better than the specification based on a full set of age dummy variables, as reported in model 2. Thus there is substantial information in the option value measures. With age dummy variables, the estimated average departure rate for each age match. But because departure fits much better. The option value model captures the variation, given age; the dummy variable model does not