An Investigation of the Assumptions of the Nbd Model as Applied to Purchasing at Individual Stores

R. Dunn, S. Reader and Neil Wrigley

Journal of the Royal Statistical Society Series C, 1983, vol. 32, issue 3, 249-259

Abstract: This paper presents an empirical investigation of the assumptions of the NBD model in the context of purchasing at individual stores. A formal testing procedure against the assumption that individuals' inter‐purchase times follow an exponential distribution shows that the Poisson assumption of the NBD model holds for the majority of consumers. The theoretical negative binomial also fits closely for centrally located stores. For suburban stores the relevant population hypothesis is of some importance, and refitting the model to a local subset of the sample removes certain small but consistent discrepancies. The NBD model may thus play an important role in studies of urban consumer behaviour.

Date: 1983
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Persistent link: https://EconPapers.repec.org/RePEc:bla:jorssc:v:32:y:1983:i:3:p:249-259

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