Working Paper Alfred P. Sloan School of Management Dynamics of Price Elasticity and the Product Life Cycle -an Empirical Study* Dynamics of Price Elasticity and the Product Life Cycle -an Empirical Study*

Abstract

The author presents a product life cycle model which incorporates carryover-effects and obsolescence and allows for time-varying price responses. An empirical study of 35 products reveals typical changes in price elasticity over the product life cycle and casts doubt upon the hypotheses prevailing in the marketing literature. Some important implications for… (More)

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