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AN ALTERNATIVE TO GOODWILL IN ADVERTISING COMPETITION MODELS
Author(s) -
Dominique C. René
Publication year - 1989
Publication title -
metroeconomica
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.256
H-Index - 29
eISSN - 1467-999X
pISSN - 0026-1386
DOI - 10.1111/j.1467-999x.1989.tb00447.x
Subject(s) - goodwill , unobservable , dominance (genetics) , economics , competition (biology) , microeconomics , stock (firearms) , market share , function (biology) , econometrics , advertising , business , finance , mechanical engineering , ecology , biochemistry , chemistry , evolutionary biology , biology , engineering , gene
The concept of a goodqill stock is often used to model advertising competition under dynamic conditions. Goodwill is unobservable and consequently leads to results that are fuzzy and untestable. This paper dispenses with that concept and uses instead a Lanchester‐Kimball structure to derive an advertising response function and other insights which are empirically testable. It also examines the factors behind firms' dominance and their individual impact on equilibrium market share.