Optimizing the Allocation of a Fixed Resource: A Simple Model and Its Experimental Test

Journal of Marketing, 43(1), 51-57, 1979

7 Pages Posted: 21 Feb 2016

See all articles by J. Carroll

J. Carroll

Rutgers, The State University of New Jersey (Deceased)

Paul E. Green

University of Pennsylvania, The Wharton School, Marketing Department (Deceased)

Wayne S. DeSarbo

Pennsylvania State University

Date Written: 1979

Abstract

A simple allocation model is developed in which response is assumed to be linear in the logs of the control variables. It is then shown that the optimal allocation of a fixed total resource is proportional to the partial regression weights when the linear-in-logs model is fitted by least squares. The model is tested on subjects' preferences for alternative allocations of leisure time. Possible applications of the model to general allocation problems are also discussed.

Suggested Citation

Carroll, J. and Green, Paul E. and DeSarbo, Wayne S., Optimizing the Allocation of a Fixed Resource: A Simple Model and Its Experimental Test (1979). Journal of Marketing, 43(1), 51-57, 1979, Available at SSRN: https://ssrn.com/abstract=2735121

J. Carroll

Rutgers, The State University of New Jersey (Deceased)

Paul E. Green

University of Pennsylvania, The Wharton School, Marketing Department (Deceased) ( email )

700 Jon M. Huntsman Hall
3730 Walnut Street
Philadelphia, PA 19104-6340
United States

Wayne S. DeSarbo (Contact Author)

Pennsylvania State University ( email )

University Park
State College, PA 16802
United States

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