Confessions of an internet monopolist: demand estimation for a versioned information good
AbstractWe develop and apply a method for estimating demand system parameters for versioned information goods. Our analysis uses data collected from a web-based field experiment in which prices and versions of an information good were exogenously varied. Using a maximum simulated likelihood (MSL) procedure, we estimate parameters characterizing distributions of utility functions over a population of potential buyers. We then construct profit‐maximizing versioning and pricing plans for the seller and assess the welfare implications of those plans. Because firms increasingly have opportunities to collect information by tracking behavior of customers, methods similar to ours could be useful in future commercial applications. Copyright (C) 2010 John Wiley & Sons, Ltd.
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Bibliographic InfoArticle provided by John Wiley & Sons, Ltd. in its journal Managerial and Decision Economics.
Volume (Year): 32 (2011)
Issue (Month): 1 (January)
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Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/7976
Other versions of this item:
- Chappell, Henry & Guimaraes, Paulo & Ozturk, Orgul, 2006. "Confessions of an Internet Monopolist: Demand Estimation for a Versioned Information Good," MPRA Paper 10106, University Library of Munich, Germany, revised 2008.
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- D42 - Microeconomics - - Market Structure and Pricing - - - Monopoly
- C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
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