Long-Term View of the Diffusion of Durables : A Study of the Role of Price and Adoption Influence Processes via Tests of Nested Models

This paper extends past research on new product diffusion by taking a long-term view of the diffusion process for several consumer durables. Specifically, we investigate the role of price and adoption influence processes within the product diffusion framework by assessing the relative superiority of competing model specifications belonging to a nested family. Results indicate that price affects the diffusion process only for relatively high-priced goods; further, our analysis suggests that this is achieved through impact on the probability of adoption. It is also shown that the traditional diffusion model specification (incorporating both external and internal influence) is not always the most adequate representation of the product adoption process