We collect experimental choice data and estimate preferences for mobile phones with a special focus on measuring consumer price evaluations when consumers face difficult choice tasks. For this purpose we employ a heteroskedastic random coefficient logit model in which the variance of the extreme value error term depends on variables that affect the consistency (with rational behavior) of choice. We specify the price of some products in the choice experiment with discount and seek to answer the question how consumers evaluate these. We find evidence in our data that the prices specified with discount significantly compromise the consistency of choice.

Additional Metadata
Keywords consumer choice models, consumer prices
Persistent URL dx.doi.org/10.1002/jae.1061, hdl.handle.net/1765/16326
Series Econometric Institute Reprint Series
Journal Journal of Applied Econometrics
Sandor, Za, & Franses, Ph.H.B.F. (2009). Consumer price evaluations through choice experiments. Journal of Applied Econometrics, 24(3), 517–535. doi:10.1002/jae.1061