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The Rotterdam Demand Model and its Application in Marketing

  • Kenneth W. Clements

    (University of Western Australia)

  • E. Antony Selvanathan

    (University of Jaffna and University of Western Australia)

This paper shows how the system-wide approach to demand analysis can be utilized in marketing. In the context of the Rotterdam model, we describe how the approach can be applied to narrowly defined groups of goods (such as beer, wine and spirits) to estimate income and price elasticities of demand. The paper also provides extensions to deal with advertising and introduces a new way of identifying market structure.

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Article provided by INFORMS in its journal Marketing Science.

Volume (Year): 7 (1988)
Issue (Month): 1 ()
Pages: 60-75

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Handle: RePEc:inm:ormksc:v:7:y:1988:i:1:p:60-75
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  1. Clements, Kenneth W & Johnson, Lester W, 1983. "The Demand for Beer, Wine, and Spirits: A Systemwide Analysis," The Journal of Business, University of Chicago Press, vol. 56(3), pages 273-304, July.
  2. Barten, A. P., 1969. "Maximum likelihood estimation of a complete system of demand equations," European Economic Review, Elsevier, vol. 1(1), pages 7-73.
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