Economists often study consumers' aggregate behavior across markets choosing from a menu of differentiated products. In this analysis, local demographic characteristics can serve as controls for market-specific heterogeneity in product preferences. Given rich demographic data, implementing these...

In discrete choice models the marginal effect of a variable of interest that is interacted with another variable differs from the marginal effect of a variable that is not interacted with any variable. The magnitude of the interaction effect is also not equal to the marginal effect of the...