Eliciting and estimating reservation price: A semi-compensatory approach
AbstractThis study proposes a two-stage method to elicit consumers' price acceptability range. The method combines a conjunctive stage to elicit price acceptability limits with a utility-based stage to choose a preferred product variation. The method is efficient in choice situations entailing many multi-attribute product variations under partial information conditions. A semi-compensatory model complements the method by jointly representing the conjunctive stage with multiple ordered-response models and the choice stage with a multinomial logit model. A case study of ceiling reservation price (CRP) elicitation for students' rental apartment choice shows (i) CRP distribution for different product variations, (ii) model estimation unraveling CRP determinants, and (iii) linkage between CRP and transaction price.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Business Research.
Volume (Year): 64 (2011)
Issue (Month): 1 (January)
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Web page: http://www.elsevier.com/locate/jbusres
Price acceptability range Ceiling reservation price Direct elicitation methods Two-stage model;
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- Kamel Jedidi & Sharan Jagpal & Puneet Manchanda, 2003. "Measuring Heterogeneous Reservation Prices for Product Bundles," Marketing Science, INFORMS, vol. 22(1), pages 107-130, July.
- Kamel Jedidi & Z. John Zhang, 2002. "Augmenting Conjoint Analysis to Estimate Consumer Reservation Price," Management Science, INFORMS, vol. 48(10), pages 1350-1368, October.
- Janiszewski, Chris & Lichtenstein, Donald R, 1999. " A Range Theory Account of Price Perception," Journal of Consumer Research, University of Chicago Press, vol. 25(4), pages 353-68, March.
- Kaplan, Sigal & Shiftan, Yoram & Bekhor, Shlomo, 2012. "Development and estimation of a semi-compensatory model with a flexible error structure," Transportation Research Part B: Methodological, Elsevier, vol. 46(2), pages 291-304.
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