Crawford, Gregory S.. (2012) Endogenous product choice : a progress report. International Journal of Industrial Organization, Vol.30 (No.3). pp. 315-320. ISSN 0167-7187

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Abstract

Empirical models of differentiated product demand are widely used by both academics and practitioners. While these methods treat carefully the potential endogeneity of price, until recently they have assumed the number and characteristics of the products offered by firms are exogenous. This paper presents a progress report on an ongoing research agenda to address this issue. First, it summarizes how the appropriate choice of “orthogonal” instruments can yield consistent estimates of own and cross-price elasticities in the presence of endogenous product characteristics. Second, it summarizes how to measure “quality markups” and the welfare consequences of endogenous product quality in U.S. cable television markets. Related papers and extensions to consider multiple product characteristics and dynamics are also discussed.

Item Type:	Journal Article
Subjects:	H Social Sciences > HB Economic Theory
Divisions:	Faculty of Social Sciences > Economics
Journal or Publication Title:	International Journal of Industrial Organization
Publisher:	Elsevier Science BV
ISSN:	0167-7187
Official Date:	May 2012
Dates:	Date Event May 2012 Published
Volume:	Vol.30
Number:	No.3
Page Range:	pp. 315-320
Identifier:	10.1016/j.ijindorg.2011.12.006
Status:	Peer Reviewed
Publication Status:	Published
Access rights to Published version:	Restricted or Subscription Access
URI:	http://wrap.warwick.ac.uk/id/eprint/47023

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