Posted: 31 Aug 2011
Date Written: September 2011
Models of consumer behavior play a key role in modern empirical industrial organization. In this review, I survey some of the models used in this literature. In particular, I discuss two commonly used demand systems: multistage budgeting approaches and discrete choice models. I motivate their use and highlight some key modeling assumptions. I next briefly discuss key issues of estimation and conclude by summarizing some extensions.
Suggested Citation: Suggested Citation
Nevo, Aviv, Empirical Models of Consumer Behavior (September 2011). Annual Review of Economics, Vol. 3, pp. 51-75, 2011. Available at SSRN: https://ssrn.com/abstract=1920101 or http://dx.doi.org/10.1146/annurev-economics-061109-080402