Abstract

This research helps fill the gap in work on the identification problem reviewed by Larry Blume et al. (2011) by showing how qualitative survey methods can potentially help separate actual contagion effects in consumption from confounding effects that look like contagion if only observational data are used. Confounding effects include correlated unobservable characteristics of the consumer, context similarity (homophily), and selection bias. Separating true contagion effects from confounding effects is of basic policy importance because true contagion effects have a social multiplier whereas the confounders do not. This article is an expository article that shows potential gains from merging two lines of inquiry in consumer research typically conducted by separate groups of scholars who do not interact very much with each other. We argue that the statistical methods of separating true contagion effects from confounding effects can benefit from qualitative interview and participant observation methods using examples from the simple living movement.

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