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dc.contributor.authorWakamori, Naokien_US
dc.date.accessioned2011-12-06en_US
dc.date.accessioned2011-12-15T12:58:04Z-
dc.date.available2011-12-15T12:58:04Z-
dc.date.issued2011en_US
dc.identifier.urihttp://hdl.handle.net/10419/53909-
dc.description.abstractConsumers often purchase more than one differentiated product, assembling a portfolio, which might potentially affect substitution patterns of demand and, as a consequence, oligopolistic firms' pricing strategies. This paper studies such consumers' portfolio considerations by developing a structural model that allows for flexible complementarities/substitutabilities depending on consumer attributes and product characteristics. I estimate the model using Japanese household-level data on automobile purchasing decisions. My estimates suggest that complementarities arise when households purchase a combination of one small automobile and one minivan as their portfolio. Ignoring such effects leads to a overstated counterfactual analysis. Simulation results suggest that a policy proposal of repealing the current tax subsidies for small ecofriendly automobiles would decrease the demand for those automobiles by 9%; less than the 14% drop predicted by a standard single discrete choice model.en_US
dc.language.isoengen_US
dc.publisherBank of Canada Ottawaen_US
dc.relation.ispartofseriesBank of Canada Working Paper 2011,27en_US
dc.subject.jelD4en_US
dc.subject.jelL5en_US
dc.subject.jelQ5en_US
dc.subject.ddc330en_US
dc.subject.keywordEconomic modelsen_US
dc.subject.keywordMarket structure and pricingen_US
dc.titlePortfolio considerations in differentiated product purchases: An application to the Japanese automobile marketen_US
dc.typeWorking Paperen_US
dc.identifier.ppn678352178en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
Appears in Collections:Bank of Canada Working Papers

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