Irreversibility in advertising-demand response functions: An application to milk

A generalized methodology for estimating irreversible functions is develope d. This approach, which accommodates short-term irreversibility and long-te rm reversibility, is an improvement over previous irreversibility studies t hat imposed both short- and long-term irreversibility. Using the proposed m ethodology, irreversibility in the demand response to fluid milk advertisin g in New York City is evaluated. Irreversibility is found to exist, and, in particular, consumers are found to react more rapidly to increases in adve rtising compared to decreases. This result may have important implications for optimal temporal advertising strategies.