Dealing with endogenous regressors is a central challenge of applied research. The standard solution is to use instrumental variables that are assumed to be uncorrelated with unobservables. We instead assume (i) the correlation between the instrument and the error term has the same sign as the...

Models of consumer behavior play a key role in modern empirical Industrial Organization. In this paper, I survey some of the models used in this literature. In particular, I discuss two commonly used demand systems: multi-stage budgeting approaches and discrete choice models. I motivate their...

In this paper we investigate the claim that academic journals are too expensive. We estimate library demand for academic journals and ask if short run profit maximization by publishers can explain observed prices. Libraries purchase a portfolio of journals so to estimate demand we extend the...

For many products the average price paid by consumers falls during periods of high demand. We use information from a large supermarket chain to decompose the decrease in the average price into a substitution effect, due to an increase in the share of cheaper products, and a price reduction...

We propose an approach to extend the standard framework of dynamic games to deal with multi-product firms. Our approach applies to industries with a large number of products offered by a small number of firms.

We compare outcomes obtained by sellers who listed their home on a newly developed For-Sale-By-Owner (FSBO) web site versus those who used an agent and the Multiple Listing Service (MLS). We do not find support for the hypothesis that listing on the MLS helps sellers obtain a significantly...

Storable products allow consumers to time their purchases to exploit price fluctuations. It has been documented that during promotions consumers buy more. The additional purchases are potentially intended not only for current use, but to be stockpiled for future consumption. This paper discusses...

One of the puzzles of store-level scanner data is the lack of a dip in quantity sold in the weeks following a promotion. Such a dip is predicted by a consumer inventory model. During a promotion consumers buy more, not only for current consumption, but stockpile for future consumption. The...

A common approach to measuring price changes is to look at the change of the expenditure needed to purchase a fixed basket of goods. It is well-known that this approach suffers from problems and creates several biases in the measurement of price changes faced by consumers. Substitution and...