| Abstract: | Hedonic price analysis was used to estimate the implicit market prices of the physical attributes and warranty provisions of refrigerators. Estimates were made of the implicit market prices of 2 warranty provisions, 6 physical characteristics and 13 brands using 1975 data on 156 models. The estimates were made of the implicit market prices of an additional 4 years and 9 years warranty coverage beyond the typical 1 year coverage. The results suggest that the implicit price of such additional warranty coverage exceeds (a) the cost of a service contract for a similar period, and (b) estimates of the present value of the expected cost of repairs. |
