Generalized entropy models

Mogens Fosgerau and André de Palma ()

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Abstract: We formulate a family of direct utility functions for the consumption of a differentiated good. This family is based on a generalization of the Shan-non entropy. It includes dual representations of all additive random utility discrete choice models, as well as models in which goods are complements. Demand models for market shares can be estimated by plain regression, enabling the use of instrumental variables. Models for microdata can be estimated by maximum likelihood.

Keywords: market shares; product differentiation; discrete choice; duality; generalized entropy; C25; L1 (search for similar items in EconPapers)
Date: 2016-03-25
New Economics Papers: this item is included in nep-dcm, nep-tre and nep-upt
Note: View the original document on HAL open archive server: https://enpc.hal.science/hal-01291347v2
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Citations: View citations in EconPapers (5)

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Working Paper: Generalized entropy models (2016)
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