A generalised nested-logit model of the demand for automobile variants

Oyvind Thomassen

Working Papers of Department of Economics, Leuven from KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven

Abstract: This paper estimates the demand for car model variants instead of looking only at demand for models in terms of the ’baseline’ variant of each model as done in the literature. The data has sex and age of the buyer for every car sold in Norway 2000-2004, in addition to characteristics of the cars. The demand model uses this information to estimate taste coefficients which depend on demographic characteristics. A nested logit model and a generalised nested logit model are used to induce correlation in the logit error between products with observable and unobservable similarities. Results indicate that it may be problematic to have different logit errors for every product when the number of products is very high, even when allowing for flexible correlation patterns.

Date: 2010-04
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://lirias.kuleuven.be/bitstream/123456789/267473/1/DPS1017.pdf

Related works:
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:ete:ceswps:ces10.17

Access Statistics for this paper

More papers in Working Papers of Department of Economics, Leuven from KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven
Bibliographic data for series maintained by library EBIB ().