Though the PIMS data have been used extensively to relate profitability both to specific firm marketing actions and to market conditions, no attempt has been made to estimate directly the magnitudes of marketing mix elasticities. The authors propose and evaluate a simple cross-sectional time series regression method that recovers unbiased estimates of the elasticities despite the presence of firm-specific disguise factors in the database. Though measurement error creates instability for certain variables, the recovered elasticities compare favorably with those found in previous research and have predictable relationships with market characteristics.
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