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Hedonic approaches to measuring price and quality change in personal computer systems

Although computers have long been studied in terms of their changing
price/performance ratio, the issue of accounting for performance in computer systems
has not been adequately addressed. This paper addresses the topic in three ways.
First, a survey of IS Managers and business "power-users" of personal computers was
conducted to empirically determine the attributes of computer systems that provide value
to users; these results guide subsequent choices regarding the operationalisation of user
value. Second, an index of system performance was developed from published
performance benchmarks and used as a direct measure of performance in the hedonic
function. Third, a set of technical proxies was shown to adequately reproduce the
performance index derived above, and was used in an alternate specification of the
hedonic function. Using data on IBM-PC compatible laptop and desktop systems, price
indexes were constructed using both approaches to performance measurement. The
results demonstrated that both approaches yielded good explanatory power and nearly
identical estimates of the rate of quality adjusted price change in PC systems. Thus, the
set of technical proxies could be used to operationalise performance in a larger data set
for which direct performance measures are unavailable.
For the 1990s, laptop PCs were found to have decreased in quality adjusted price at an
average of 39% per year while the corresponding figure for desktop PCs was 35% per
year. / Business, Sauder School of / Graduate
Date05 1900
CreatorsChwelos, Paul
Source SetsUniversity of British Columbia
Detected LanguageEnglish
TypeText, Thesis/Dissertation
Format9111576 bytes, application/pdf
RightsFor non-commercial purposes only, such as research, private study and education. Additional conditions apply, see Terms of Use

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