AN EMPIRICAL-INVESTIGATION OF THE DYNAMIC MCFADDEN MODEL OF PURCHASE TIMING AND BRAND CHOICE - IMPLICATIONS FOR MARKET-STRUCTURE

purchase timing and brand-choice decisions of households are jointly i nvestigated using the ''dynamic McFadden'' model of Heckman and Singer . The hazard of brand purchase is decomposed into the category purchas e hazard and the probability of brand choice conditional on category p urchase. The former is modeled using the hazard-function approach and the latter using a legit model. Unobserved heterogeneity in brand pref erences, marketing effects, and baseline hazard parameters is accounte d for in the empirical analysis. The distribution of preference hetero geneity identities the locations of brands in multiattribute perceptua l space and the distribution of attribute importance weights across ho useholds.