When Does Static Willingness to Pay Mislead? A Framework for Dynamic Hedonic Valuation
Fuente:
arXiv
Gespeichert in:
| 1. Verfasser: | |
|---|---|
| Format: | Preprint |
| Veröffentlicht: |
2026
|
| Schlagworte: | |
| Online-Zugang: | |
| Tags: |
Tag hinzufügen
Keine Tags, Fügen Sie den ersten Tag hinzu!
|
| _version_ | 1866917510754861056 |
|---|---|
| author | Auer, Josephine |
| author_facet | Auer, Josephine |
| contents | Many policy counterfactuals depend on how consumers value product attributes such as sugar, sodium, caffeine, alcohol, or emissions. Standard hedonic and differentiated-products models interpret these valuations statically. That interpretation is restrictive when attributes are habit forming: observed prices then reflect both contemporaneous marginal value and the continuation value generated by current consumption. I develop a nonparametric revealed-preference framework for dynamic hedonic valuation, deriving necessary and sufficient conditions for rationalising observed prices and choices. Using household scanner data on cereal purchases, I show that the hedonic representation places real restrictions on prices, while habit formation improves behavioural coherence conditional on that representation. The results provide a diagnostic for when static attribute valuation is justified and when prices reveal more than contemporaneous marginal values. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2603_02456 |
| institution | arXiv |
| publishDate | 2026 |
| record_format | arxiv |
| spellingShingle | When Does Static Willingness to Pay Mislead? A Framework for Dynamic Hedonic Valuation Auer, Josephine Theoretical Economics Econometrics General Economics Economics Many policy counterfactuals depend on how consumers value product attributes such as sugar, sodium, caffeine, alcohol, or emissions. Standard hedonic and differentiated-products models interpret these valuations statically. That interpretation is restrictive when attributes are habit forming: observed prices then reflect both contemporaneous marginal value and the continuation value generated by current consumption. I develop a nonparametric revealed-preference framework for dynamic hedonic valuation, deriving necessary and sufficient conditions for rationalising observed prices and choices. Using household scanner data on cereal purchases, I show that the hedonic representation places real restrictions on prices, while habit formation improves behavioural coherence conditional on that representation. The results provide a diagnostic for when static attribute valuation is justified and when prices reveal more than contemporaneous marginal values. |
| title | When Does Static Willingness to Pay Mislead? A Framework for Dynamic Hedonic Valuation |
| topic | Theoretical Economics Econometrics General Economics Economics |
| url | https://arxiv.org/abs/2603.02456 |