Advanced Search
MyIDEAS: Login

A state-dependent model of hybrid behavior with rational consumers in the attribute space

Contents:

Author Info

  • Sergi Jiménez-Martín

    (Universitat Pompeu Fabra and FEDEA)

  • Antonio Ladrón de Guevara-Martínez

    (Universitat Pompeu Fabra)

Abstract

This paper presents a dynamic choice model in the attribute space considering rational consumers. The model presents a stationary consumption pattern that can be inertial, where the consumer only buys one product, or a varietyseeking one, where the consumer shifts among varied products. Under the hybrid utility assumption, the consumer behaves inertially among the unfamiliar brands for several periods, eventually switching to a varietyseeking behavior when the stationary levels are approached. An empirical illustration with myopic agents is run using scanner databases for three different product categories: fabric softener, saltine cracker, and catsup. Nonlinear specifications provide the best fit of the data, as hybrid functional forms are found in all the products. The resullts confirm the gradual trend to seek variety as the level of familiarity with the purchased items increases.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: ftp://ftp.fundacionsepi.es/InvEcon/paperArchive/Sep2009/v33i3a2.pdf
File Function: Full text
Download Restriction: no

Bibliographic Info

Article provided by Fundación SEPI in its journal Investigaciones Económicas.

Volume (Year): 33 (2009)
Issue (Month): 3 (September)
Pages: 347-383

as in new window
Handle: RePEc:iec:inveco:v:33:y:2009:i:3:p:347-383

Contact details of provider:
Postal: Investigaciones Economicas Fundación SEPI Quintana, 2 (planta 3) 28008 Madrid Spain
Email:
Web page: http://www.fundacionsepi.es/

Order Information:
Email:
Web: http://www.fundacionsepi.es/revistas/presentacion.asp

Related research

Keywords: Choice models; state-dependence; hybrid behavior.;

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Claes Fornell & William T. Robinson & Birger Wernerfelt, 1985. "Consumption Experience and Sales Promotion Expenditure," Management Science, INFORMS, vol. 31(9), pages 1084-1105, September.
  2. Jain, Dipak C & Vilcassim, Naufel J & Chintagunta, Pradeep K, 1994. "A Random-Coefficients Logit Brand-Choice Model Applied to Panel Data," Journal of Business & Economic Statistics, American Statistical Association, vol. 12(3), pages 317-28, July.
  3. Pradeep K. Chintagunta, 1993. "Investigating the Sensitivity of Equilibrium Profits to Advertising Dynamics and Competitive Effects," Management Science, INFORMS, vol. 39(9), pages 1146-1162, September.
  4. Bruce G. S. Hardie & Eric J. Johnson & Peter S. Fader, 1993. "Modeling Loss Aversion and Reference Dependence Effects on Brand Choice," Marketing Science, INFORMS, vol. 12(4), pages 378-394.
  5. Joseph Farrell, 1985. "Moral Hazard as an Entry Barrier," Working papers 387, Massachusetts Institute of Technology (MIT), Department of Economics.
  6. James M. Lattin, 1987. "A Model of Balanced Choice Behavior," Marketing Science, INFORMS, vol. 6(1), pages 48-65.
  7. Richard Thaler, 1985. "Mental Accounting and Consumer Choice," Marketing Science, INFORMS, vol. 4(3), pages 199-214.
  8. McAlister, Leigh, 1982. " A Dynamic Attribute Satiation Model of Variety-Seeking Behavior," Journal of Consumer Research, University of Chicago Press, vol. 9(2), pages 141-50, September.
  9. Jaehwan Kim & Greg M. Allenby & Peter E. Rossi, 2002. "Modeling Consumer Demand for Variety," Marketing Science, INFORMS, vol. 21(3), pages 229-250, December.
  10. Pradeep K. Chintagunta & Dipak Jain, 1992. "A Dynamic Model of Channel Member Strategies for Marketing Expenditures," Marketing Science, INFORMS, vol. 11(2), pages 168-188.
  11. Milgrom, Paul & Roberts, John, 1986. "Price and Advertising Signals of Product Quality," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 796-821, August.
  12. Green, Paul E & Srinivasan, V, 1978. " Conjoint Analysis in Consumer Research: Issues and Outlook," Journal of Consumer Research, University of Chicago Press, vol. 5(2), pages 103-23, Se.
  13. Rishin Roy & Pradeep K. Chintagunta & Sudeep Haldar, 1996. "A Framework for Investigating Habits, “The Hand of the Past,” and Heterogeneity in Dynamic Brand Choice," Marketing Science, INFORMS, vol. 15(3), pages 280-299.
  14. Kapil Bawa, 1990. "Modeling Inertia and Variety Seeking Tendencies in Brand Choice Behavior," Marketing Science, INFORMS, vol. 9(3), pages 263-278.
  15. Keane, Michael P, 1997. "Modeling Heterogeneity and State Dependence in Consumer Choice Behavior," Journal of Business & Economic Statistics, American Statistical Association, vol. 15(3), pages 310-27, July.
  16. Moshe Givon, 1984. "Variety Seeking Through Brand Switching," Marketing Science, INFORMS, vol. 3(1), pages 1-22.
  17. Abel P. Jeuland, 1979. "Brand Choice Inertia as One Aspect of the Notion of Brand Loyalty," Management Science, INFORMS, vol. 25(7), pages 671-682, July.
  18. Peter M. Guadagni & John D. C. Little, 1983. "A Logit Model of Brand Choice Calibrated on Scanner Data," Marketing Science, INFORMS, vol. 2(3), pages 203-238.
  19. Tversky, Amos & Kahneman, Daniel, 1991. "Loss Aversion in Riskless Choice: A Reference-Dependent Model," The Quarterly Journal of Economics, MIT Press, vol. 106(4), pages 1039-61, November.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:iec:inveco:v:33:y:2009:i:3:p:347-383. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Isabel Sánchez-Seco).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.