When Does Lag Structure Really Matter in Optimizing Advertising Expenditures?

Wesley A. Magat, John M. McCann and Richard C. Morey
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Wesley A. Magat: Fuqua School of Business, Duke University, Durham, North Carolina 27706
John M. McCann: Fuqua School of Business, Duke University, Durham, North Carolina 27706
Richard C. Morey: Fuqua School of Business, Duke University, Durham, North Carolina 27706

Management Science, 1986, vol. 32, issue 2, 182-193

Abstract: A paper by Bultez and Naert in the May 1979 issue of Management Science tentatively concludes that profits are relatively insensitive to misspecification of the lag structure of advertising. We examine the conditions under which a firm's profits are most likely to be sensitive to the misspecification of the lag structure. Our analysis indicates how this sensitivity is related to (a) the form of the true lag structure, (b) the demand function, (c) the cost function, and (d) the firm's discount rate.

Keywords: marketing; advertising; econometrics (search for similar items in EconPapers)
Date: 1986
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:32:y:1986:i:2:p:182-193

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