quantifying the economic value of warranties in us server market junhong chu pradeep k chintagunta january 2007 very preliminary and incomplete national university singapore chicago we thank jean pierre dubé puneet manchanda peter rossi trichy krishnan v padmanabhan rajiv surendra soo jiuan tan for helpful comments usual disclaimer applies 1 abstract quantify base or bundled to manufacturers channel intermediaries customers then decompose into various components consistent with different theoretical rationales warranty provision although several such exist insurance sorting quality signaling etc are offered largely purposes durations purpose among heterogeneous as all servers sold major offer non uniform cannot obtain by simple price comparisons across conditions instead use structural modeling counterfactual experiments accomplish empirical task derive our demand model from utility maximization that accounts a customer s risk aversion behavior
