The Outside Good Bias in Logit Models of Demand with Aggregate Data

The logit model is the most popular tool for estimating demand in differentiated products markets. However, in its aggregate version, practitioners have to “guess” the size outside good. We propose a way to remove the bias created by an inaccurate guess in simpler versions of the model.

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Year of publication:	2013
Authors:	Huang, Dongling ; Rojas, Christian
Published in:	Economics Bulletin. - AccessEcon, ISSN 1545-2921. - Vol. 33.2013, 1, p. 198-206
Publisher:	AccessEcon
Subject:	Logit model \| demand estimation \| outside good \| differentiated products

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Extent:	application/pdf
Type of publication:	Article
Classification:	C1 - Econometric and Statistical Methods: General ; D4 - Market Structure and Pricing
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10011278635