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Confessions of an Internet Monopolist: Demand Estimation for a Versioned Information Good

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  • Chappell, Henry
  • Guimaraes, Paulo
  • Ozturk, Orgul

Abstract

We investigate profit-maximizing versioning plans for an information goods monopolist. The analysis employs data obtained from a web-based field experiment in which potential buyers were offered information goods in varied price-quality configurations. Maximum simulated likelihood (MSL) methods are used to estimate parameters describing the distribution of utility function parameters across potential buyers of the good. The resulting estimates are used to examine the impact of versioning on seller profits and market efficiency.

Suggested Citation

  • Chappell, Henry & Guimaraes, Paulo & Ozturk, Orgul, 2006. "Confessions of an Internet Monopolist: Demand Estimation for a Versioned Information Good," MPRA Paper 10106, University Library of Munich, Germany, revised 2008.
  • Handle: RePEc:pra:mprapa:10106
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    References listed on IDEAS

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    Cited by:

    1. John S. Jatta & Krishna Kumar Krishnan, 2016. "An empirical assessment of a univariate time series for demand planning in a demand-driven supply chain," International Journal of Business Forecasting and Marketing Intelligence, Inderscience Enterprises Ltd, vol. 2(3), pages 269-290.

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    More about this item

    Keywords

    Versioning; price discrimination; field experiment; maximum simulated likelihood;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D42 - Microeconomics - - Market Structure, Pricing, and Design - - - Monopoly
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments

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