Stochastic Consumer Behavior and Brownian Motion

Adhikari Atanu ()
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Adhikari Atanu: Indian Institute of Management Kozhikode

No 282, Working papers from Indian Institute of Management Kozhikode

Abstract: Previous researches suggested multiple approaches in modeling consumer purchase behavior. Along with uncertainties, in many situations, particularly in low involvement products and frequently purchased consumer packaged goods, little conscious decision making takes place. We assume that stochastic purchase behavior observed in the consumers is due to some kind of agitation within the consumers before or during the purchase. Due to such agitation in the mind of the consumers, purchase decision of above products experience several internal forces in different directions. We show that these forces imbalance consumers’ mind and purchase decision become random. Since these forces are haphazard, we show that resultant force that influences the purchase decision is also haphazard. The main purpose of this article is to show that one can represent consumers’ purchase behavior of low involvement and frequently purchased products as Brownian motion. In other words, we are to prove the existence of the process by conforming above four defined properties of Brownian motion.

Keywords: Consumer Behavior; Brownian Motion (search for similar items in EconPapers)
Pages: 13 pages
Date: 2018-05
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