Working Paper: CEPR ID: DP17866
Authors: Raluca Ursu; Stephan Seiler; Elisabeth Honka
Abstract: We provide a detailed overview of the empirical implementation of the sequential search model proposed by Weitzman (1979). We discuss the assumptions underlying the model, the identification of search cost and preference parameters, elasticities and welfare formulas, and different estimation approaches. The goal of this paper is to consolidate knowledge and provide a unified treatment of various aspects of sequential search models that are relevant for empirical work.
Keywords: sequential search model
JEL Codes: D43; D83; L13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| search costs (D23) | consumer preferences (D11) |
| consumer preferences (D11) | search behavior (D83) |
| search order (C69) | preference parameters (D11) |
| search costs (D23) | stopping probabilities (C69) |
| stopping probabilities (C69) | search costs (D23) |
| search order (C69) | stopping decisions (D91) |
| stopping decisions (D91) | search costs (D23) |
| search costs (D23) | likelihood of purchasing a product (D12) |
| preference parameters (D11) | sensitivity of purchase decisions (D91) |