Some observations on the impact of advertising on demand

Jonq-Ying Lee, Mark G. Brown and Gary F. Fairchild
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Jonq-Ying Lee: Florida Department of Citrus, and Adjunct Professor and Adjunct Associate Professor, Food and Resource Economics Department, University of Florida, Postal: Florida Department of Citrus, and Adjunct Professor and Adjunct Associate Professor, Food and Resource Economics Department, University of Florida
Mark G. Brown: Florida Department of Citrus, and Adjunct Professor and Adjunct Associate Professor, Food and Resource Economics Department, University of Florida, Postal: Florida Department of Citrus, and Adjunct Professor and Adjunct Associate Professor, Food and Resource Economics Department, University of Florida
Gary F. Fairchild: Food and Resource Economics Department, University of Florida, Postal: Food and Resource Economics Department, University of Florida

Agribusiness, 1989, vol. 5, issue 6, 607-618

Abstract: This article examines the decay structure of advertising and the incorporation of advertising in systems of demand equations by scaling and translating methods. Under the assumption that a consumer's purchase of an advertised product is directly related to his|her recall of a specific advertisement, the decay effect of advertising for everyday products is a monotonic decreasing function of time. In the scaling model, advertising has a tendency to be more effective when demand is price elastic (inelastic) given a quantity augmenting (diminishing) type scaling impact. In the translating model, the impact of advertising is related to the marginal propensity to consume.

Date: 1989
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Persistent link: https://EconPapers.repec.org/RePEc:wly:agribz:v:5:y:1989:i:6:p:607-618

DOI: 10.1002/1520-6297(198911)5:6<607::AID-AGR2720050606>3.0.CO;2-I

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