Demand Estimation under Incomplete Product Availability

Christopher Conlon and Julie Mortimer

American Economic Journal: Microeconomics, 2013, vol. 5, issue 4, 1-30

Abstract: Incomplete product availability is an important feature of many markets, and ignoring changes in availability may bias demand estimates. We study a new dataset from a wireless inventory system on vending machines to track product availability every four hours. The data allow us to account for product availability when estimating demand, and provide valuable variation for identifying substitution patterns when products stock out. We develop a procedure that allows for changes in product availability when availability is only observed periodically. We find significant differences in demand estimates: the corrected model predicts significantly larger impacts of stock-out events on profitability.

JEL-codes: D12 D92 G31 L81 M11 (search for similar items in EconPapers)
Date: 2013
Note: DOI: 10.1257/mic.5.4.1
References: Add references at CitEc
Citations: View citations in EconPapers (82)

Downloads: (external link)
http://www.aeaweb.org/articles.php?doi=10.1257/mic.5.4.1 (application/pdf)
http://www.aeaweb.org/aej/mic/data/2010-0062_data.zip (application/zip)
http://www.aeaweb.org/aej/mic/app/2010-0062_app.pdf (application/pdf)
http://www.aeaweb.org/aej/mic/ds/november2013/2010-0062_ds.zip (application/zip)
Access to full text is restricted to AEA members and institutional subscribers.

Related works:
Working Paper: Demand Estimation Under Incomplete Product Availability (2012)
Working Paper: Demand Estimation Under Incomplete Product Availability (2008)
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: https://EconPapers.repec.org/RePEc:aea:aejmic:v:5:y:2013:i:4:p:1-30

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

Access Statistics for this article

American Economic Journal: Microeconomics is currently edited by Johannes Hörner

More articles in American Economic Journal: Microeconomics from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().