Estimating Coke and Pepsi's Price and Advertising Strategies

UC Berkeley Competition Policy Center Working Paper No. CPC99-04

53 Pages Posted: 28 Feb 2004

See all articles by Amos Golan

Amos Golan

American University - Department of Economics

Larry S. Karp

University of California, Berkeley

Jeffrey M. Perloff

University of California, Berkeley - Department of Agricultural & Resource Economics

Date Written: July 1998

Abstract

A semi-parametric, information-based estimator is used to estimate strategies in prices and advertising for Coca-Cola and Pepsi-Cola. Separate strategies for each firm are estimated with and without restrictions from game theory. These information/entropy estimators are consistent, are efficient, and do not require distributional assumptions. These estimates are used to test theories about the strategies of firms and to see how changes in incomes or factor prices affect these strategies.

Keywords: strategies, noncooperative games, oligopoly, generalized maximum

JEL Classification: C13, C35, C72, L13, L66

Suggested Citation

Golan, Amos and Karp, Larry S. and Perloff, Jeffrey M., Estimating Coke and Pepsi's Price and Advertising Strategies (July 1998). UC Berkeley Competition Policy Center Working Paper No. CPC99-04. Available at SSRN: https://ssrn.com/abstract=506243 or http://dx.doi.org/10.2139/ssrn.506243

Amos Golan

American University - Department of Economics ( email )

4400 Massachusetts Avenue, N.W.
Washington, DC 20016-8029
United States

Larry S. Karp (Contact Author)

University of California, Berkeley ( email )

Dept. of Agriculture & Resource Economics
313 Giannini Hall
Berkeley, CA 94720
United States
510-643-8911 (Fax)

Jeffrey M. Perloff

University of California, Berkeley - Department of Agricultural & Resource Economics ( email )

207 Giannini Hall
Berkeley, CA 94720
United States
510-642-9574 (Phone)
510-643-8911 (Fax)

HOME PAGE: http://are.berkeley.edu/~perloff

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