Pricing in the International Takeoff of New Products
54 Pages Posted: 10 Nov 2012
Date Written: September 9, 2012
This study focuses on the effect of two dimensions of price (relative price and price volatility) on the international takeoff of new products. The study examines these drivers of takeoff using a novel data set of bimonthly observations from 7 new consumer electronic products across each of 8 countries. The empirical analysis reveals that both relative price and price volatility significantly impact the hazard of takeoff. However, while the effect of relative price holds steady across contexts, the effects of price volatility are moderated by wealth, culture, and contagion. The use of temporally disaggregate data at the bimonthly level allows the identification of the effect of price volatility and enables identification of takeoff more precisely than with annual data.
Keywords: International Takeoff, Diffusion of Innovations, New Products, New Product Pricing, Level of Data Aggregation
JEL Classification: M31
Suggested Citation: Suggested Citation