Consumer Choice and Market Penetration of New Technologies: Application of a Discrete-Choice Model. Final Report. CRA Report No. 423

摘要

The purpose of this report is to demonstrate the feasibility of developing a full-scale disaggregate structural model of market penetration. An equipment choice model, which represents the most crucial and one of the most intractable components of the disaggregate model, is developed and estimated using data on residential space heating equipment. This econometric model is incorporated, along with empirical representations of equipment replacement, depreciation, and capital stock growth, in a simulation model to represent a limited version of a disaggregate structural model of market penetration. The penetration of an example new technology is then evaluated to demonstrate the advantages achieved by pursuing a disaggregate structural approach to modeling market penetration. Discrete choice modeling literature is briefly surveyed in the second chapter. Chapter 3 describes the data base used to estimate the model and Chapter 4 presents the estimation results. In Chapter 5 the empirical discrete choice model is combined with the optimal replacement relationships, a simple representation of the characteristics of the existing space heating equipment stock, and assumptions concerning future stock growth to develop a limited version of the disaggregate structural model. The final chapter concludes with a short discussion of future research required to extend the components of the limited model version to yield a detailed policy-oriented model of market penetration. (ERA citation 06:027223)