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Consumer heterogeneity evolving from social group dynamics. Latent class analyses of German footwear consumption 1980-1991

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  • A. Frenzel Baudisch

Abstract

Boundedly rational consumers rely on their social environment as a source of information. Drawing upon psychological theories about social comparison processes, we hypothesize that social reference groups underlie market segments. New reference groups can emerge from social comparison processes, leading to the establishment of new submarkets and the evolution of aggregate consumer heterogeneity. These propositions are tested with series of cross-sectional surveys on footwear consumption of German men between 1980 and 1991. Using latent class models, we describe the emergence of the submarket for athletic shoes as a function of the appearance and establishment of a new social consumer group.

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Bibliographic Info

Paper provided by Philipps University Marburg, Department of Geography in its series Papers on Economics and Evolution with number 2006-04.

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Length: 35 pages
Date of creation: May 2006
Date of revision:
Handle: RePEc:esi:evopap:2006-04

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  1. Bhatnagar, Amit & Ghose, Sanjoy, 2004. "A latent class segmentation analysis of e-shoppers," Journal of Business Research, Elsevier, Elsevier, vol. 57(7), pages 758-767, July.
  2. Abernathy, William J. & Clark, Kim B., 1985. "Innovation: Mapping the winds of creative destruction," Research Policy, Elsevier, Elsevier, vol. 14(1), pages 3-22, February.
  3. Ron Adner & Daniel Levinthal, 2001. "Demand Heterogeneity and Technology Evolution: Implications for Product and Process Innovation," Management Science, INFORMS, INFORMS, vol. 47(5), pages 611-628, May.
  4. Paul Windrum, 2005. "Heterogeneous preferences and new innovation cycles in mature industries: the amateur camera industry 1955--1974," Industrial and Corporate Change, Oxford University Press, vol. 14(6), pages 1043-1074, December.
  5. Mark Bils & Peter J. Klenow, 2001. "The Acceleration of Variety Growth," American Economic Review, American Economic Association, American Economic Association, vol. 91(2), pages 274-280, May.
  6. Janssen, Marco A. & Jager, Wander, 2001. "Fashions, habits and changing preferences: Simulation of psychological factors affecting market dynamics," Journal of Economic Psychology, Elsevier, Elsevier, vol. 22(6), pages 745-772, December.
  7. Malerba, Franco, et al, 1999. "'History-Friendly' Models of Industry Evolution: The Computer Industry," Industrial and Corporate Change, Oxford University Press, vol. 8(1), pages 3-40, March.
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Cited by:
  1. Desai, Kalpesh Kaushik & Trivedi, Minakshi, 2014. "Do consumer perceptions matter in measuring choice variety and variety seeking?," Journal of Business Research, Elsevier, Elsevier, vol. 67(1), pages 2786-2792.
  2. Vanessa OLTRA & Maïder SAINT JEAN, 2009. "Environmental Innovations and Industrial Dynamics (In French)," Cahiers du GREThA, Groupe de Recherche en Economie Théorique et Appliquée 2009-22, Groupe de Recherche en Economie Théorique et Appliquée.

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