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Much research has focused on the effects of reference prices on brand choice decisions using scanner panel data. The theory and application are well-documented and accepted. However, researchers have found contrary results on the existence of loss aversion in consumer goods markets. Loss aversion is a phenomenon based on the reference dependent theory that consumers respond more to losses (reference price<price) than to gains (reference price>price). The mixed results on the existence of loss aversion can be a result of not adequately accounting for consumer heterogeneity in response to marketing effects. Therefore, we focus our analysis on loss aversion and adequately accounting for consumer heterogeneity. We estimate a reference dependent model with a mixed logit specification that allows for a continuous distribution of response heterogeneity in the population. We use Gibbs Sampling to …