Working Paper: NBER ID: w8624
Authors: Alvin J Silk; Lisa R Klein; Ernst R Berndt
Abstract: We assess substitutable and complementary relationships among eight national advertising media classes, as well as the magnitude of their own-price elasticities. We use a translog demand model, whose parameters we estimate by three-stage least squares, based on 1960-94 annual U.S. data.We find aggregate demand by national advertisers for each of the eight media is own-price inelastic, and that cross-price elasticities suggest slightly more substitute than complementary relationships, although both are rather weak. These patterns are consistent with long prevailing institutional arrangements and media selection practices.
Keywords: No keywords provided
JEL Codes: D0; L8; M3
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| aggregate demand for each media class (E10) | own-price inelasticity (D11) |
| cross-price elasticities (D11) | substitutive relationships (L14) |
| cross-price elasticities (D11) | complementary relationships (D10) |