The dichotomous nature of purchase decisions and the importance of a threshold concept in explaining reactions to stimuli require statistical techniques other than traditional regression analysis for estimating the parameters. The multivariate probit technique meets the requirements of a threshold decision model. An empirical example is combined with the basic description of the model.
Get full access to this article
View all access options for this article.
References
1.
BerryBrian J. L.Geography of Market Centers and Retail Distribution.Englewood Cliffs, N.J.: Prentice-Hall, 1967.
2.
BilkeyWarren J.The Basic Relationship in Consumer Expenditure Behavior, Studies in Marketing Farm Products No. 4-H. Cambridge: Harvard University, 1951.
FarrellM. J. “The Demand for Motor Cars in the United States,” Journal of the Royal Statistical Society, 117 (Part 2, 1954), 171–201.
5.
FinneyD. J.Probit Analysis.Cambridge: Cambridge University Press, 1952.
6.
GoldbergerArthur S.Econometric Theory.New York: John Wiley & Sons, 1964.
7.
HeckelR. V. and JordanR. M.Psychology.St. Louis: C. V. Mosby, 1967.
8.
HillL. D.Adjustments in Drying and Storage Capacity at Farm and Elevator, AERR-105.Urbana: University of Illinois, Department of Agricultural Economics, 1970.
9.
HillL. D. “Buying Corn on a No. 2 Basis: A Solution to the Moisture-Discount Problem,” Economics for Agriculture, MKTG 49.Urbana: University of Illinois, 1967.
10.
IsaacsonR. L., HuttM. L., and BlumM. L.Psychology: The Science of Behavior.New York: Harper and Row, 1965.
11.
JohnsonG. L., HalterA. N., JensenH. R., and ThomasD. W.A Study of Managerial Processes of Midwestern Farmers.Ames: The Iowa State University Press, 1961.