Ao Wang is an assistant professor in economics and a research associate of the CAGE at the University of Warwick since obtaining a PhD in economics from CREST (Center for Research in Economics and Statistics) in 2020. He holds a Diplôme d’ingénieur from Ecole Polytechnique and ENSAE in France, as well as a B.S. in Probability and Statistics from Peking University (China).
His main research interests are empirical industrial organization and structural econometrics.
https://sites.google.com/view/aowang-economics/home
Coautor: Alessandro Iaria
We introduce a Generalized Nested Logit model of demand for bundles that can be estimated sequentially and virtually eliminates any challenge of dimensionality related to large choice sets. We use it to investigate quantity discounts for carbonated soft drinks by simulating a counterfactual with linear pricing. The prices of quantities up to 1L decrease by −31.5% while those of larger quantities increase by +14.8%. Purchased quantities decrease by −20.4%, associated added sugar by −23.8%, and industry profit by −20.5%. Consumer surplus however reduces only moderately, suggesting that linear pricing may be effective in limiting added sugar intake.
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