Advertising as a Signaling Device: Simulated Maximum Likelihood Estimation of a Multiple Random Effects Count Data Model

Posted: 2 Jul 2009

See all articles by Jörgen Hellström

Jörgen Hellström

Umeå University - Umeå School of Business and Economics

Nicklas Rudholm

affiliation not provided to SSRN

Date Written: August 28, 2008

Abstract

The paper empirically studies whether pharmaceutical firms use advertising as a signal for high quality drugs. A multiple random effects count data hurdle model is specified and a simulated maximum likelihood estimation approach is developed and utilized in the empirical analysis.

Keywords: Signaling, Advertising, Multiple random effects, Simulated maximum likelihood, Count data

JEL Classification: L15, L21

Suggested Citation

Hellström, Jörgen and Rudholm, Nicklas, Advertising as a Signaling Device: Simulated Maximum Likelihood Estimation of a Multiple Random Effects Count Data Model (August 28, 2008). Economics Letters, Vol. 101, 2008. Available at SSRN: https://ssrn.com/abstract=1427925

Jörgen Hellström (Contact Author)

Umeå University - Umeå School of Business and Economics ( email )

Umea, 90187
Sweden
+46-90-7866987 (Phone)

HOME PAGE: http://www.usbe.umu.se/english/about/staff/?languageId=1&uid=johe0001

Nicklas Rudholm

affiliation not provided to SSRN ( email )

No Address Available

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