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

49 Pages Posted: 23 Aug 2013

See all articles by Chris Rohlfs

Chris Rohlfs

Syracuse University

Ryan Sullivan

Naval Postgraduate School

Thomas J. Kniesner

Claremont Graduate University - Department of Economic Sciences; Syracuse University - Department of Economics; IZA

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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.

Keywords: hedonic, discrete choice, identification, experiment, quasi-experiment, marginal willingness to pay, attribute demand, amenity, heterogeneous goods, generalized, endogenous attributes, complement, substitute

JEL Classification: D12, C35, C31, D61, C9

Suggested Citation

Rohlfs, Chris and Sullivan, Ryan and Kniesner, Thomas J., Hedonic Estimation Under Very General Conditions Using Experimental and Quasi-Experimental Designs. IZA Discussion Paper No. 7554, Available at SSRN: https://ssrn.com/abstract=2314849 or http://dx.doi.org/10.2139/ssrn.2314849

Chris Rohlfs (Contact Author)

Syracuse University ( email )

Center for Policy Resarch
426 Eggers Hall
Syracuse, NY 13244
United States

HOME PAGE: http://www-cpr.maxwell.syr.edu/

Ryan Sullivan

Naval Postgraduate School ( email )

1 University Circle
Monterey, CA 93943-5001
United States

Thomas J. Kniesner

Claremont Graduate University - Department of Economic Sciences ( email )

Claremont, CA 91711
United States

Syracuse University - Department of Economics ( email )

Syracuse, NY 13244-1020
United States

IZA

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Bonn, D-53072
Germany

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