A general assumption of the standard hedonic price model is that producers produce outputs/services efficiently, and deviations from this situation are assumed to involve either overcharging or undercharging. We consider an alternative hedonic model, where we assume that, among the alternative...

A general assumption of the standard hedonic price model is that producers produce outputs/ services efficiently, and deviations from this situation are assumed to involve either overcharging or undercharging. Using the profit maximising behaviour, we derive an alternative hedonic model to show...