Hedonic Prices in the German Market for Mobile Phones

This paper provides a hedonic price analysis of mobile telephones for the German market. We have assembled data on 302 different handsets from 25 manufacturers over the period from May 1998 to November 2003. While volume has a negative effect on the price of a mobile handset, the number of ringtones and the talk time battery life relative to the handset's weight positively affect mobile phone prices. Maybe somewhat surprisingly, radiation is statistically not significant. Also handsets have become cheaper over time, and handsets with additional features, such as MMS, MP3 or Bluetooth, command a higher price. In addition, we found positive brand name effects for LG, Nokia, Motorola and Samsung, but not for Siemens or Sony. According to our estimations these brand name premiums may range from 57 to 172 Euros.