This paper proposes an integrated model that incorporates, as special cases, the double-hurdle arid the purchase-infrequency models, both previously used to account for zero observations in commodity demand analyses. Monte-Carlo simulations show that the integrated model is more robust to misspecification of the censoring rule than any of the two simpler models. The integrated model is then applied to the demand for tobacco products in Israel. The purchase-infrequency results were closer to those of the integrated model than the results of the double-hurdle model.
- Integrated model
- Zero observations