Econometric modeling of competition: A multi-category choice-based mappingapproach

Both the recent advances in econometric analysis of panel data in economics and the availability of scanner panel data in marketing have motivated mar keting researchers to conduct internal analysis of market structure based o n revealed preference data. This kind of analysis allows the analyst to inf er brand positions in an attribute space from preference and choice data, g iven a market in which consumers have heterogeneous tastes for attributes. Extant market structure models based on disaggregate panel data are probabi listic models that provide spatial representations of market structure but if a few products share the same brand name across product categories, cons umer perceptions of product locations sharing the same brand name may be in terdependent. The main contribution of this paper is to present a probabili stic spatial panel data model that allows the positions of products sharing the same name to be correlated across product categories. (C) 1999 Elsevie r Science S.A. All rights reserved. JEL classification. C23; C25; M31.