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Article

Heterogeneity in demand for performances and seats in the theatre

Studying the heterogeneity of consumers allows to price the product differently for consumer segments or groups of a product. In this paper we estimate a model of aggregate demand for Perm Opera and Ballet Theatre focusing on the heterogeneity in price effect on demand for tickets on different performances and seats. We estimate parameters of demand function using censored quantile regression that accounts for the limited capacity of the theatre house. We reveal the price effect variation across different types of theatrical productions and seats with lower elastic demand on ballets and for seats of higher quality.