We quantitatively investigate the allocative and welfare effects of secondary markets for cars. An important source of gains from trade in these markets is the heterogeneity in the willingness to pay for higher-quality (newer) goods, but transaction costs are an impediment to instantaneous...

We examine the impact of the EUR 5 billion German Cash-for-Clunkers program on vehicle registrations and respective CO2 emissions. To construct proper counterfactuals, we develop the multivariate synthetic control method using time series of economic predictors (MSCMT) and show (asymptotic)...

El presente documento busca analizar el comportamiento de los hogares colombianos en la compra de vehículo nuevo para uso particular, y modelar el funcionamiento de la demanda de vehículos particulares en Colombia, entre 2009 y 2011. Esto a partir de la estimación de un modelo logit anidado...

This note develops a model of product differentiation that can be estimated using standard regression techniques and applies it to a panel data set of new car sales. The model allows for complex substitution patterns according to an overlapping nest structure that makes cars closer substitutes...

This paper examines how consumers react to the financial distress of durable goods manufacturers by looking at the Swedish new car market. We employ a difference-in-differences matching methodology whereby we compare sales of carmaker Saab with those of a carefully constructed control group of...

The concept of diminishing marginal utility is a cornerstone of economic theory. The consumption of a good typically creates satiation that diminishes the marginal utility of consuming more. Temporal satiation induces consumers to increase their stimulation level by seeking variety and therefore...

The assumption of multiplicative non-separable (Cobb-Douglas) consumer preferences is a key assumption for analyzing the interdependence of consumption and leisure choices. In this paper we solve the consumer utility maximization problem under these preferences and derive a simultaneous system...

We develop a model of household demand for frequently purchased consumer goods that are branded, storable and subject to stochastic price fluctuations. Our framework accounts for how inventories and expectations of future prices affect current period purchase decisions. We estimate our model...

Consider an experiment in which subjects are asked to choose between pairs consisting of a monetary payment and a time-delay at which the payment is delivered. Given a finite set of observations, under what conditions the choices of an individual agent can be rationalised by a discounted utility...

The paper presents a revision of the contemporary reductionistic demand theory, replacing the studying object, i.e. an individual, with a fuzzy collection of market buyers, regarded as a “statistical ensemble of consumers”. The new holistic market demand theory formally retains the...