AbstractThis paper introduces a mixed effects model for an application of the hedonic price regression model for panel data. Thus far, the development of hedonic pricing regression for repeated measurements has received relatively little attention. This approach is applied to compare different pricing strategies of companies in the digital still camera industry in Japan. The results suggest that there exist statistically significant differences in speed of price decline among companies and price differences between two observed stores. The results from this analysis are different from those of the previous study in the digital still camera using a modified PCA hedonic regression model by Miyamoto and Tsubaki Behaviormetrika 2001;2:111–152, which may bias to more significant results through fitting fixed effects models without serial correlations. Copyright © 2002 John Wiley & Sons, Ltd.