An Empirical Analysis of Strategic Pricing and Advertising for Differentiated Products
2005/01/28
研討會日期 : 2005-01-28
時間 : 15:00
主講人 : Prof. Shinn-Shyr Wang
地點 : B棟110室
演講者簡介 : Prof. Wang為Ph.D. in Agricultural and Applied Economics，University of Wisconsin-Madison (2004)。
現為Associate Scientist，University of Wisconsin-Madison
其主要領域為Industrial Organization、Financial Economics。
演講摘要 : he analysis of strategic behavior of firms using a structural model is widely used in the New Empirical Industrial Organization (NEIO) literature. Researchers simplify the structural model by specifying ad-hoc or approximated demand specifications, and reduced form conditions because of the complexity of flexible demand and cost functions. However, the ad-hoc demand specifications may not satisfy all the requirements of consumer theory.
In this paper we adopt a fully flexible representative consumer model based on nonlinear Almost Ideal Demand Specifications (AIDS). We estimate the price and advertising elasticities of demand for leading brands of butter and margarine, and investigate the degree of market power in this industry. We test strategic behaviors on two choice variables, price and advertising, with different combinations of Nash, Stackelberg, and collusion. Using data on the U.S. butter and margarine industry from 1998 to 2002, limited information maximum likelihood (LIML) estimations of demand and cost functions are obtained, market structures of product and advertising are identified, and hypothesis tests of long-lived advertising effects and homogeneous consumer responses are conducted.
