Advertising and Retail Promotion of Washington Apples: A Structural Latent Variable Approach to Promotion Evaluation
Abstract"Commodity promotion" consists of many activities, each designed to contribute to a consumer's product knowledge or influence tastes. However, both knowledge and tastes are unobservable, or latent, variables influencing demand. This paper specifies a dynamic structural model of fresh fruit demand that treats promotion and other socioeconomic variables as "causal" variables influencing these latent variables. Estimating this state-space model using a Kalman filter approach provides estimates of both the system parameters and a latent variable series. The results show that these latent effects contribute positively to apple and other fruit consumption, while reducing banana consumption.
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Bibliographic InfoPaper provided by Arizona State University, Morrison School of Agribusiness and Resource Management in its series Working Papers with number 28547.
Date of creation: 1998
Date of revision:
commodity promotion; demand system; DYMIMIC; fresh fruit; Kalman filter; LA/AIDS; latent variables; Marketing;
Other versions of this item:
- Richards, Timothy J. & Gao, Xiaoming & Patterson, Paul M., 1999. "Advertising And Retail Promotion Of Washington Apples: A Structural Latent Variable Approach To Promotion Evaluation," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 31(01), April.
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