Tabular foundation models achieve strong accuracy on choice prediction tasks, but their predictions often violate the economic logic those tasks require: raising a price sometimes increases predicted demand, and implied willingness-to-pay estimates are frequently negative or implausible. We propose a two-stage adapter that embeds foundation model predictions within a utility-maximization framework. In the first stage, we estimate a standard choice model whose parameters are constrained to obey economic theory. In the second stage, we freeze those parameters and train a correction term that incorporates the foundation model's predictions as additional information. The result is a model that inherits the foundation model's accuracy gains while guaranteeing monotonic price-demand relationships under policy perturbation and producing analytically computable trade-off measures. On two transportation datasets, the adapter recovers up to 13 percentage points of accuracy over a standard logit model while maintaining perfect economic consistency, something neither the raw foundation models nor conventional distillation achieve.
Tabular foundation models achieve strong accuracy on choice prediction tasks, but their predictions often violate the economic logic those tasks require: raising a price can increase predicted demand, implied willingness-to-pay estimates are frequently negative or implausible, and unavailable alternatives receive nonzero probability. We propose a two-stage adapter that takes a foundation model's predicted choice probabilities as a precomputed feature and embeds them inside a multinomial logit's utility. In Stage 1, we fit the multinomial logit's structural coefficients by maximum likelihood with sign constraints; in Stage 2, we freeze those coefficients and fit a small neural correction operating on the foundation model's predictions. We prove that this composition exactly preserves the multinomial logit's marginal rate of substitution, so analytically computable value-of-time becomes a mathematical guarantee rather than an empirical accident. Across three datasets and two foundation models, the adapter gains 6.4 percentage points (pp) of test accuracy on average over the multinomial logit and up to 12.8 pp, maintains 100% cost monotonicity, and produces values of time within the published transportation-economics range on the transportation datasets. Performance degrades gracefully under foundation-model context restriction, retaining at least 6 pp of accuracy gain even at 10% of the original foundation-model context.
Tabular foundation models (TFMs) generate predictions on structured data via in-context learning, without task-specific estimation. We ask whether TFMs can be effectively applied to discrete choice, a central demand estimation framework in marketing and operations, and find that directly applying TFMs yields limited performance. The gap is structural: TFMs assume row-independent observations, whereas discrete choice is inherently set-valued and subject to persistent consumer preference heterogeneity. We propose a reformulation that encodes both choice-set dependence and individual heterogeneity within a row-based learning framework. Evaluated on a yogurt scanner panel, individual-level heterogeneity encoding is the dominant driver of predictive accuracy. The best reformulation outperforms hierarchical Bayesian estimation by 8% in holdout log-likelihood and 3.6% in hit rate, running 16 times faster, a practical advantage for large-scale demand estimation. The advantage is largest in the medium-data regime (10--40 purchase occasions per consumer), where parametric Bayesian shrinkage most distorts estimates for atypical consumers. Fine-tuning on population choice data provides additional gains for consumers with shallow purchase histories, where in-context learning has limited individual-specific signal to condition on. These results establish a principled approach for applying foundation models to consumer choice problems more broadly.
Tabular Foundation Models (TFMs) are currently the best approach to tabular prediction problems. They are constructed as transformers that approximate the Bayesian posterior predictive distribution based on a pre-training prior. These univariate predictors can be converted into multivariate ones autoregressively by sampling one target and adding it to the features. However, the faithfulness of the resulting joint has not been investigated. Furthermore, TFMs cannot be evaluated against the posterior itself, at least not on real-world datasets, because the ground-truth distribution is unknown. We therefore propose asking a different question: could a model's predictions result from any joint distribution? To answer this question, we pose two requirements that any such model must satisfy. The first is marginalization consistency, which demands that marginalized conditionals are equal to directly predicted marginals. The second is factorization consistency, which demands that different factorization orders result in equal joint distributions. Every TFM that we evaluate violates both of these requirements for both classification and regression across all datasets.
Christian Klötergens, Vijaya Krishna Yalavarthi, Lars Schmidt-Thieme +1