Dynamic Response Models
Routing Summary
Dynamic models add time structure: carryover, lags, competitive reaction, and time-varying parameters.
- Koyck, PDL, GLPF, ADL, temporal aggregation → Carryover Effects and Distributed Lags
- Cournot/Bertrand/Stackelberg reaction functions → Reaction Functions and Competitive Dynamics
- Concave/S-shaped/convex response, hysteresis, pulsing → Shape of the Marketing Response Function
- Design decisions for dynamic models → Design of Dynamic Response Models
Concept Map
| Concept | Note | Type | Depends On | Key Result |
|---|---|---|---|---|
| Carryover & distributed lags | Carryover Effects and Distributed Lags | concept | Functional Forms in Marketing, Markets Data and Sales Drivers, Design of Static Response Models | Temporal carryover via geometric lags, PDL, feedback, and bias correction |
| Competitive reaction functions | Reaction Functions and Competitive Dynamics | concept | Carryover Effects and Distributed Lags, Market Share Models | Competitor reaction functions via Cournot, Bertrand, Stackelberg, Sweezy |
| Shape of the response function | Shape of the Marketing Response Function | concept | Functional Forms in Marketing, Carryover Effects and Distributed Lags | Response shape (concave/S/convex) drives optimal budget allocation |
| Dynamic model design | Design of Dynamic Response Models | concept | Design of Static Response Models, Carryover Effects and Distributed Lags, Reaction Functions and Competitive Dynamics | Extends static to dynamic via time, lags, and short/long-run effects |
Notes
- Carryover Effects and Distributed Lags — CONTAINS: Koyck/geometric distributed lag, long-run multiplier theorem, geometric lag with purchase feedback (GLPF), Almon polynomial distributed lag (PDL), autoregressive distributed lag (ADL), Doyle-Saunders lead-lag taxonomy (6 cases), return-to-normality time-varying-parameter model, ratchet (asymmetric) models, Clarke (1976) aggregation-bias theorem, and the Bass-Leone and Weiss-Weinberg-Windal recovery procedures.
- Reaction Functions and Competitive Dynamics — CONTAINS: Cournot, Bertrand, and Stackelberg (leader-follower) reaction functions, Sweezy kinked demand curve, absolute-change and relative (log-log) reaction models, the generalized reaction matrix (VAR system), Tobit model for censored reactions, and distributed reaction lags.
- Shape of the Marketing Response Function — CONTAINS: prior-knowledge levels (0/1/2), concave (diminishing returns) theorem, S-shaped (convex-concave) response with threshold, convex (increasing returns) response, threshold-effect kinked-linear model, hysteresis and path dependence via unit root, pulsing-strategy table by shape, and ratchet (historical-maximum) models.
- Design of Dynamic Response Models — CONTAINS: ADL framework, direct-lag identification strategy, short-run vs long-run effects (impact vs total multiplier) theorem, model-order selection (AIC, BIC, adjusted , Ljung-Box Q), simultaneity/endogeneity assessment, and the ARIMA/ARMAX / transfer-function connection.