This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

The European used-car market at a glance: Hedonic resale price valuation in automotive leasing industry

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Sylvain Prado

Additional information is available for the following registered author(s):

Abstract

In the leasing industry, the risk of loss on sales at the end of the contract term, as well as pricing are critically impacted by the forecasted resale price of the asset (residual value). We apply the Hedonic methodology to European auto lease portfolios, in order to estimate the resale price distribution. The Hedonic approach estimates the price of a good through the valuation of its attributes. Following a discussion on Hedonic prices, we propose an operational model for the automobile resale market. The model is applied to four European countries (France, Germany, Spain and Great Britain), and distributions are calculated on two vehicle versions (Audi A4 & Ford Focus) allowing a comparison of market depreciation patterns and residual value risks.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. 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: http://economix.u-paris10.fr/pdf/dt/2009/WP_EcoX_2009-22.pdf
File Format: application/pdf
File Function:
Download Restriction: no

Publisher Info
Paper provided by University of Paris West - Nanterre la Défense, EconomiX in its series EconomiX Working Papers with number 2009-22.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length: 37 pages
Date of creation: 2009
Date of revision:
Handle: RePEc:drm:wpaper:2009-22

Contact details of provider:
Postal: 200 Avenue de la R�publique, B�t. K - 92001 Nanterre Cedex
Phone: 01 40 97 59 07
Fax: 01 40 97 70 57
Email:
Web page: http://economix.u-paris10.fr
More information through EDIRC

For technical questions regarding this item, or to correct its listing, contact: (Bruno Chaves).

Related research
Keywords: Hedonic model; residual value; automotive market;

Find related papers by JEL classification:
C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
G12 - Financial Economics - - General Financial Markets - - - Asset Pricing
G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Capital and Ownership Structure

This paper has been announced in the following NEP Reports:

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.:
  1. Bartik, Timothy J, 1987. "The Estimation of Demand Parameters in Hedonic Price Models," Journal of Political Economy, University of Chicago Press, vol. 95(1), pages 81-88, February. [Downloadable!] (restricted)
  2. Couton, C & Gardes, F & Thepaut, Y, 1996. "Hedonic Prices for Environmental and Safety Characteristics and the Akerloff Effect in the French Car Market," Applied Economics Letters, Taylor and Francis Journals, vol. 3(7), pages 435-40, July. [Downloadable!] (restricted)
  3. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb.. [Downloadable!] (restricted)
  4. James N. Brown & Harvey S. Rosen, 1982. "On the Estimation of Structural Hedonic Price Models," NBER Technical Working Papers 0018, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  5. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74, pages 132. [Downloadable!] (restricted)
  6. Ivar Ekeland & James J. Heckman & Lars Nesheim, 2004. "Identification and Estimation of Hedonic Models," Journal of Political Economy, University of Chicago Press, vol. 112(S1), pages S60-S109, February. [Downloadable!] (restricted)
    Other versions:
  7. Cubbin, John S, 1975. "Quality Change and Pricing Behaviour in the United Kingdom Car Industry 1956-1968," Economica, London School of Economics and Political Science, vol. 42(165), pages 43-58, February. [Downloadable!] (restricted)
  8. Akerlof, George A, 1970. "The Market for 'Lemons': Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, MIT Press, vol. 84(3), pages 488-500, August. [Downloadable!] (restricted)
  9. Makoto Ohta & Zvi Griliches, 1976. "Automobile Prices Revisited: Extensions of the Hedonic Hypothesis," NBER Chapters, in: Household Production and Consumption, pages 325-398 National Bureau of Economic Research, Inc. [Downloadable!]
  10. Yerger, David B, 1996. "Used Car Markets: Reliability Does Matter, but Do Consumer Reports?," Applied Economics Letters, Taylor and Francis Journals, vol. 3(2), pages 67-70, February. [Downloadable!] (restricted)
  11. Hartman, Raymond S, 1987. "Product Quality and Market Efficiency: The Effect of Product Recalls on Resale Prices and Firm Valuation," The Review of Economics and Statistics, MIT Press, vol. 69(2), pages 367-72, May. [Downloadable!] (restricted)
  12. Cowling, Keith & Cubbin, John, 1972. "Hedonic Price Indexes for United Kingdom Cars," Economic Journal, Royal Economic Society, vol. 82(327), pages 963-78, September. [Downloadable!] (restricted)
  13. Pratt, Michael D & Hoffer, George E, 1990. "The Efficiency of Used Vehicle Markets: The Case of Technological Obsolescence and Differential Repair Records," Applied Economics, Taylor and Francis Journals, vol. 22(9), pages 1205-13, September.
  14. Atkinson, Scott E & Halvorsen, Robert, 1990. "The Valuation of Risks to Life: Evidence from the Market for Automobiles," The Review of Economics and Statistics, MIT Press, vol. 72(1), pages 133-36, February. [Downloadable!] (restricted)
  15. Triplett, Jack E, 1969. "Automobiles and Hedonic Quality Measurement," Journal of Political Economy, University of Chicago Press, vol. 77(3), pages 408-17, May/June. [Downloadable!] (restricted)
Full references

Statistics
Access and download statistics

Did you know? Cannot find something on IDEAS? Encourage the publisher to index it! Instructions.

This page was last updated on 2009-11-23.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.