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Estimating class‐specific parametric models under class uncertainty: local polynomial regression clustering in an hedonic analysis of wine markets

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  • Marco Costanigro
  • Ron C. Mittelhammer
  • Jill J. McCluskey

Abstract

We introduce a method for estimating multiple class regression models when class membership is uncertain. The procedure—local polynomial regression clustering—first estimates a nonparametric model via local polynomial regression, and then identifies the underlying classes by aggregating sample observations into data clusters with similar estimates of the (local) functional relationships between dependent and independent variables. Finally, parametric functions specific to each class are estimated. The technique is applied to the estimation of a multiple‐class hedonic model for wine, resulting in the identification of four distinct wine classes based on differences in implicit prices of the attributes. Copyright © 2009 John Wiley & Sons, Ltd.

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  • Marco Costanigro & Ron C. Mittelhammer & Jill J. McCluskey, 2009. "Estimating class‐specific parametric models under class uncertainty: local polynomial regression clustering in an hedonic analysis of wine markets," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(7), pages 1117-1135, November.
    • Handle: RePEc:wly:japmet:v:24:y:2009:i:7:p:1117-1135
    DOI: 10.1002/jae.1094
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    7. Vincent Hoang & Takao Iida & Shigeru Matsumoto & Natsuki Watanabe & Clevo Wilson, 2014. "Market penetration of imported agricultural products: A hedonic analysis of the Japanese table wine market," Working Papers e083, Tokyo Center for Economic Research.
    8. Bonanno, Alessandro & Bimbo, Francesco & Costanigro, Marco & VIscecchia, Rosaria, 2018. "Do Geographic Indication Labels Pay off? Estimating GI’s implicit Price Dispersion in the Italian EVOO Market," 2018 Annual Meeting, August 5-7, Washington, D.C. 274203, Agricultural and Applied Economics Association.
    9. Deselnicu, Oana C. & Costanigro, Marco & Souza-Monteiro, Diogo M. & McFadden, Dawn Thilmany, 2013. "A Meta-Analysis of Geographical Indication Food Valuation Studies: What Drives the Premium for Origin-Based Labels?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 38(2), pages 1-16, August.
    10. Ernesto Tavoletti, 2018. "Un?alternativa alla retorica della dimensione aziendale e degli IDE: sistemi agro-alimentari sostenibili di PMI ed internazionalizzazione endogena per mezzo delle indicazioni geografiche," AGRICOLTURA ISTITUZIONI MERCATI, FrancoAngeli Editore, vol. 2018(2), pages 27-42.
    11. Manuel Garcia & Carlos Carpio & Darren Hudson & Tullaya Boonsaeng & Chenggang Wang, 2024. "Mexican consumers' perceptions and preferences for US and Texas beef," Agribusiness, John Wiley & Sons, Ltd., vol. 40(4), pages 727-748, October.
    12. Tang, M. & Thompson, N.M. & Boyer, C.N. & Widmar, N.J.O. & Lusk, J.L., 2023. "Implicit Market Segmentation and Valuation of Angus Bull Attributes," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 48(2), May.

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