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Hedonic Estimation under Very General Conditions Using Experimental and Quasi-Experimental Designs

Author

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  • Rohlfs, Chris

    (Morgan Stanley)

  • Sullivan, Ryan

    (Naval Postgraduate School)

  • Kniesner, Thomas J.

    (Claremont Graduate University)

Abstract

This paper develops a generalized hedonic model in which an exogenous shock to a single product attribute can affect other attributes, the markets for the product's complements and substitutes, and aggregate quantity produced. These factors are shown to be empirically relevant and to cause bias in traditional approaches. Experimental and quasi-experimental estimators of attribute demand are introduced that address these biases, are transparent, and are straightforward to implement. One of these estimators is applied to measure the marginal military recruit's valuation of educational benefits, which is found to range across packages from -$0.024 to +$0.467 per dollar of benefits.

Suggested Citation

  • Rohlfs, Chris & Sullivan, Ryan & Kniesner, Thomas J., 2013. "Hedonic Estimation under Very General Conditions Using Experimental and Quasi-Experimental Designs," IZA Discussion Papers 7554, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp7554
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    1. Chris Rohlfs & Ryan Sullivan & Thomas Kniesner, 2015. "New Estimates of the Value of a Statistical Life Using Air Bag Regulations as a Quasi-experiment," American Economic Journal: Economic Policy, American Economic Association, vol. 7(1), pages 331-359, February.

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    More about this item

    Keywords

    generalized; heterogeneous goods; amenity; attribute demand; marginal willingness to pay; quasi-experiment; experiment; identification; discrete choice; hedonic; endogenous attributes; complement; substitute;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
    • C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models; Quantile Regressions; Social Interaction Models
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments

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