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Panel Data Double-Hurdle Model: An Application To Dairy Advertising

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  • Dong, Diansheng
  • Chung, Chanjin
  • Kaiser, Harry M.

Abstract

In this study, we extend to panel data structures the double-hurdle model typically used in cross-sectional data. The new double-hurdle model can account not only for the censored nature of commodity purchases, but also for the dynamics of the purchase process. In this model, a flexible error structure is assumed to account for state dependence and household-specific heterogeneity. In the empirical application for milk purchase, we find that generic advertising increases the probability of market participation as well as the purchase quantity and incidence. Temporal dependence is also found in both purchase and participation equations.

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Bibliographic Info

Paper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2001 Annual meeting, August 5-8, Chicago, IL with number 20502.

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Date of creation: 2001
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Handle: RePEc:ags:aaea01:20502

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Keywords: double-hurdle model; panel data; household purchase; milk; advertising; heterogeneity; state dependence; simulated maximum likelihood; Marketing;

References

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Cited by:
  1. Maynard, Leigh J. & Hartell, Jason G. & Meyer, A. Lee & Hao, Jianqiang, 2003. "An Experimental Approach To Valuing New Differentiated Products," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25810, International Association of Agricultural Economists.
  2. Beltran, Jesusa C. & Pannell, David J. & Doole, Graeme J. & Benedict, White, 2011. "Factors that affect the use of herbicides in Philippine rice farming systems," Working Papers 108769, University of Western Australia, School of Agricultural and Resource Economics.

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