The Review of Economics and Statistics Vol. 75 No. 3 1993
Estimating Automotive Elasticities from Segment Elasticities and First Choice/Second Choice Data
Abstract
Of the share lost to one product because of a price change, diversion fractions are the fractions of that lost share going to each of the other products. This paper expresses product cross-elasticities in terms of diversion fractions and a scaling factor. Since the automotive market includes more than two-hundred products, time-series data are insufficient for estimating all elasticities. Instead, this paper estimates automotive elasticities by specifying the diversion fractions using cross-sectional first choice/second choice data and estimating the remaining scaling factor and own-elasticities using more aggregate elasticities estimated from time series.
- DOI
- 10.2307/2109459
- Volume
- 75
- Issue
- 3
- Pages
- 455
- Sources
- crossref openalex