NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Intermedia Substitutability and Market Demand by National Advertisers

Alvin J. Silk, Lisa R. Klein, Ernst R. Berndt

NBER Working Paper No. 8624
Issued in December 2001
NBER Program(s):   IO

We assess substitutable and complementary relationships among eight national advertising media classes, as well as the magnitude of their own-price elasticities. We use a translog demand model, whose parameters we estimate by three-stage least squares, based on 1960-94 annual U.S. data.We find aggregate demand by national advertisers for each of the eight media is own-price inelastic, and that cross-price elasticities suggest slightly more substitute than complementary relationships, although both are rather weak. These patterns are consistent with long prevailing institutional arrangements and media selection practices.

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Document Object Identifier (DOI): 10.3386/w8624

Published: Silk, Alvin J., Lisa R. Klein and Ernst R. Berndt. "Intermedia Substitutability And Market Demand By National Advertisers," Review of Industrial Organization, 2002, v20(4,Jun), 323-348.

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