Personalized License Plates

This research critiques the article "A Bandwagon effect in personalized license plates? by Jeff Biddle (1991, pp. 375388). The article is critiqued within the context of eight specific questions, and the critique is structured around these questions.

What Is the Justification for Writing the Article?

Biddle (1991, p. 375) stated in the article that: "No one to my knowledge has attempted to empirically verify the existence of or estimate the magnitude of a bandwagon effect in any product market." In the article, Biddle (1991, pp. 375388) attempted to accomplish both of these feats. Thus, the justification for writing this article was to empirically verify the existence of or estimate the magnitude of a bandwagon effect in a product market.

Biddle (1991, p. 375) selected the vanity license plate market to test the bandwagon effect theory. The author started with a basic model of product demand that did not include any bandwagon effect variable (Biddle, 1991, pp. 375376). To add a bandwagon effect to the basic model, Biddle (1991, p. 376) assumed that purchaser preferences would be dependent upon aggregate behavior. In other words, Biddle (1991, p. 376) assumed that an individual would be motivated to buy a vanity license plate because other members of the community made such purchases.

When Biddle (1991, p. 376) incorporated the bandwagon

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The second estimating equation controls the results of the first estimating equation for variations in the pricing of vanity license plates. Evaluation of the Statistical Work Biddle (1991, pp. 375388) calculated both a standard demand for vanity license plates and a bandwagon demand for such plates. Both sets of calculations includes variables for vanity license plate price, mean income levels within the states from which the data were drawn, the number of automobiles registered in the states from which the data were drawn, the number of characters permitted on vanity license plates by the states from which the data were drawn, promotional activity associated with the marketing of vanity license plates in the states from which the data were drawn, and the age of the vanity license plate program in the states from which the data were drawn. Standard demand and bandwagon demand were calculated through the application of the regression models stated in the preceding section of this critique. Biddle (1991, p. 380) calculated a DurbanWatson statistic covering the relationship between standard demand and bandwagon demand for vanity license plates. The DurbanWatson statistic tests for the presence of autocorrelation. Th
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Some common words found in the essay are:
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Approximate Word count = 1468
Approximate Pages = 6 (250 words per page)