Endogeneity and Simultaneity in Competitive Pricing and Advertising: A Logit Demand Analysis

Pradeep K. Chintagunta (), Vrinda Kadiyali and Naufel J. Vilcassim
Additional contact information
Vrinda Kadiyali: Cornell University
Naufel J. Vilcassim: London Business School

Journal of Business, 2006, vol. 79, issue 6, pages 2761-2788

Abstract: In this article, we use four data sets to provide a benchmark study of the effects of accounting for endogeneity and simultaneity in estimating marketing-mix effects in a logit demand framework. We compare the results obtained from accounting for endogeneity only to those from accounting for both endogeneity and simultaneity, and in the latter case we allow for more general models of firm behavior to examine the consequences of imposing assumptions about the behavior of firms. We find that accounting for both endogeneity and simultaneity not only affects the parameter estimates but also results in efficiency gains that affect the statistical significance of the estimates.

Date: 2006
View citations in EconPapers

Downloads: (external link)
http://www.journals.uchicago.edu/cgi-bin/resolve?JB790601 main text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:ucp:jnlbus:v:79:y:2006:i:6:p:2761-2788

Ordering information: This journal article can be ordered from
http://www.journals.uchicago.edu/JB/home.html

Access Statistics for this article

Journal of Business is edited by Albert Madansky

More articles in Journal of Business from University of Chicago Press
Address: The University of Chicago Press, Journals Division, P.O. Box 37005 Chicago, IL 60637
Series data maintained by Christopher F. Baum ().