DP20393 Environmental Impacts of Banning Vehicle Advertising
Advertising
We develop a structural model of demand and pricing of vehicles which incorporates the heterogeneous effects of advertising. We estimate the model using rich data on sales and advertising at the age-group and product level from 2012-2021 in France. We disentangle the positive spillover effects of advertising from its business-stealing effects and find that advertising has a positive effect on vehicle sales and reduces consumers' price sensitivity. Our counterfactual simulations show that an
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