Rutger van Oest () (Tilburg University) Philip Hans Franses () (Faculty of Economics, Erasmus Universiteit Rotterdam)
Abstract
Market share models for weekly store-level data are useful to understand competitive structures by delivering own and cross price elasticities. These models can however not be used to examine which brands lose share to which brands during a specific period of time. It is for this purpose that we propose a new model, which does allow for such an examination. We illustrate the model for two product categories in two markets, and we show that our model has validity in terms of both in-sample fit and out-of-sample forecasting. We also demonstrate how our model can be used to decompose own and cross price elasticities to get additional insights into the competitive structure.
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Find related papers by JEL classification: C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - General C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Other Model Applications M31 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Marketing
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