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The Rotterdam Demand Model and its Application in Marketing

Author

Listed:
  • Kenneth W. Clements

    (University of Western Australia)

  • E. Antony Selvanathan

    (University of Jaffna and University of Western Australia)

Abstract

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.

Suggested Citation

  • Kenneth W. Clements & E. Antony Selvanathan, 1988. "The Rotterdam Demand Model and its Application in Marketing," Marketing Science, INFORMS, vol. 7(1), pages 60-75.
    • Handle: RePEc:inm:ormksc:v:7:y:1988:i:1:p:60-75
    DOI: 10.1287/mksc.7.1.60
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    Cited by:

    1. Adrian R. Fleissig, 2016. "Changing Trends in U.S. Alcohol Demand," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 44(3), pages 263-276, September.
    2. Pradeep K. Chintagunta & Harikesh S. Nair, 2011. "Structural Workshop Paper --Discrete-Choice Models of Consumer Demand in Marketing," Marketing Science, INFORMS, vol. 30(6), pages 977-996, November.
    3. Kenneth W. Clements & Saroja Selvanathan, 1991. "The Economic Determinants Of Alcohol Consumption," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 35(2), pages 209-231, August.
    4. K.E. Quek, 1988. "The Demand of Alcohol in Canada: An econometric study," Economics Discussion / Working Papers 88-08, The University of Western Australia, Department of Economics.
    5. K.W. Clements, 1988. "UWA Studies in Applied Demand Analysis," Economics Discussion / Working Papers 88-20, The University of Western Australia, Department of Economics.
    6. E. A. Selvanathan & S. Selvanathan, 2004. "Economic and demographic factors in Australian alcohol demand," Applied Economics, Taylor & Francis Journals, vol. 36(21), pages 2405-2417.
    7. Clements, Kenneth W. & Gao, Grace, 2015. "The Rotterdam demand model half a century on," Economic Modelling, Elsevier, vol. 49(C), pages 91-103.
    8. E.A. Selvanathan, 1991. "A Cross-Country Alcohol Consumption Comparison: An application of the Rotterdam demand system," Economics Discussion / Working Papers 91-04, The University of Western Australia, Department of Economics.
    9. Duffy, Martyn, 1995. "Advertising in demand systems for alcoholic drinks and tobacco: A comparative study," Journal of Policy Modeling, Elsevier, vol. 17(6), pages 557-577, December.
    10. Duffy, Martyn, 2003. "On the estimation of an advertising-augmented, cointegrating demand system," Economic Modelling, Elsevier, vol. 20(1), pages 181-206, January.
    11. Selvanathan, Eliyathamby A & Jayasinghe, Maneka & Selvanathan, Saroja, 2025. "Modelling the alcohol consumption patterns of australian households," Economic Analysis and Policy, Elsevier, vol. 85(C), pages 754-767.
    12. James Fogarty, 2010. "The Demand For Beer, Wine And Spirits: A Survey Of The Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 24(3), pages 428-478, July.

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