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A hedonic price analysis of hearing aid technology

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In this article, we study how technological components affect the price of hearing aids. The main goals are to determine which functional and technological features have the greatest influence on manufacturer-based prices in the hearing aid industry, and to analyse the price-cost margins at the dispenser level using a unique data set that is compiled from a hearing clinic in West Texas. The result shows that style and signal processing scheme are the two most important determinants of hearing aid price. Other characteristics such as directional microphone, noise cancellation, and a certain shell type are also positively related to price. Further, on average, this particular local dispenser has a markup of about 35% per hearing instrument.
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Keywords: I19; L11; L13; O14; O21; hearing aids; hedonics; price-cost-margins; technology

Document Type: Research Article

Affiliations: 1: Department of Economics,Lancaster University Management School, Lancaster University, Lancaster,LA1 4YX, UK 2: Section of General Internal Medicine, University of Chicago, 5841 S. Maryland AveChicago,IL 60637, USA 3: Research Institute of Economics and Management, Southwestern University of Finance and Economics, Chengdu,Sichuan 610074, China

Publication date: 2013-06-01

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