Embedding Consumer Taste for Location into a Structural Model of Equilibrium

Patrick Walsh () and Franco Mariuzzo
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Franco Mariuzzo: Department of Economics, Trinity College

Economic Papers from Trinity College Dublin, Economics Department

Abstract: Given that brands (products) are location specific in terms of coverage of retail stores, we allow consumers to have preferences over location and products to carry distribution costs, alongside preferences and costs over other observable and unobservable product characteristics. We embed these considerations into Berry, Levinsohn and Pakes (1995) to jointly estimate demand and cost parameters for brands (products) in Retail Carbonated Soft Drinks. Allowing for location has a very significant impact on estimated primitives and the predictive power of the structural model. As a counterfactual exercise we show the e?ects on welfare of an equilibrium that results from a change in the distribution of consumer taste for location.

JEL-codes: L11 L62 (search for similar items in EconPapers)
Date: 2005-08
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Citations: View citations in EconPapers (4)

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Related works:
Working Paper: Embedding Consumer Taste for Location into a Structural Model of Equilibrium (2005)
Working Paper: Embedding consumer taste for location into a structural model of equilibrium (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:tcd:tcduee:tep3

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