693 research outputs found

    A Model for the Effects of Psychological Pricing in Gabor-Granger Price Studies

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    We present a model of consumers' price sensitivity that explicitly deals with the existence of so-called psychological price levels or odd prices, i.e. prices ending in an odd number. The model is formulated in a latent class framework, in which splines are used to model utility as a function of prices in consumer segments. The knots in the splines represent psychological prices. Additionally, the model allows for inferences on price expectations and the role of price as an indicator of quality. The model is tailored to the analysis of so-called Gabor-Granger price experiments. We provide an empirical application to the analysis of a Gabor-Granger study, and investigate the performance of our model relative to a competing model. (C) 1998 Elsevier Science B.V. All rights reserved

    Identification and Estimation of Complex Multivariate Lag Structures: a Nesting Approach

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    A process for investigating complex and multivariate lag structures is proposed. The sources of the dynamic promotional effects on sales are explained and related to conventional means of mathematical expression. Multivariate and hybrid versions of the expressions are proposed and nests of equations are derived. The nests are not universal, so depend upon the subject selection of final models. The process is finally followed using an example from the pharmaceutical industry where both promotions and detailing are in use
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