Comparison of hedonic price and artificial neural network models in estimating factors affecting second – hand car prices in Samsun

In this study, determinants of second-hand automobile prices are examined and focused on the estimation of price using the second-hand automobile advertisements in Samsun. As known, second-hand automobile pricing is a difficult matter for both automobile buyers and sellers. The primary goal of this paper is to identify the determinants of second-hand automobile pricing. Additionally, the second purpose is to compare the prediction performances of two statistical models in order to predict second-hand automobile prices. In this context, hedonic models and artificial neural networks are handled in this study. Hedonic models utilize multiple regression models on large data sets in the analyses. On the other hand, artificial neural networks are employed in this studty as an alternative method on account of potential non-linearity in the hedonic functions. As a conclusion, the present paper demonstrates both determinants of second-hand automobile prices in Samsun, and also artificial neural networks can be a better alternative method for prediction of the second-hand automobile prices.