This thesis presents an analysis of advertising, encompassing both new game theoretic models of advertising, and econometric models of industry level advertising and sales. In the game theoretic analysis, three related models are developed. A duopoly industry is assumed, and, typically, the firms have four choice variables- price, advertising, the number of local markets to enter and product quality. The aim is to model firms' simultaneous use of advertising as a means of providing consumer information and as a competitive tool. The models are also used to discover under what circumstances firms will prefer to produce homogeneous, rather than quality differentiated products. A feature of the models is that in certain scenarios one of the firms finds that it faces a kinked demand curve for it's product, a result of the two firms selecting to produce products differentiated according to quality. Given the problems of testing the game theoretic models developed, the empirical analysis considers UK industry level data for the food and soft drinks industries. These data are employed to test whether advertising and sales are cointegrated in these industries. Quarterly data are used, as existing literature suggests that any relationship between advertising and sales is likely to be identified within a year. The use of unadjusted quarterly data ensured that unlike earlier research which tested for cointegration between annual advertising and sales, seasonal unit root tests were required.
| Identifer | oai:union.ndltd.org:bl.uk/oai:ethos.bl.uk:488153 |
| Date | January 1998 |
| Creators | Elliott, Caroline Fiona |
| Publisher | University of Manchester |
| Source Sets | Ethos UK |
| Detected Language | English |
| Type | Electronic Thesis or Dissertation |
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