Price-Performance Competition and the Merger Guidelines

While analysis of competition among differentiatedproducts has evolved under the revisions to theMerger Guidelines since 1982, it remains adhoc. This paper argues that price and performancecompetition among differentiated products is the rulerather than the exception and proposes methods toexplicitly analyze both forms of competition. Themethods address price and performance competition indemand and supply, explicitly incorporatingcompetitive responses as called for by the 1992 Guidelines. Empirical implementation is discussed for a specificmarket.     

US consumers' perceptions of the importance of following the US dietary guidelines

This study examines the factors affecting perceptions by US consumers about the importance of following each type of healthy diet recommendation based on the Dietary Guidelines for Americans. Results generally suggest that individuals from the Northeast and non-metropolitan areas, males, less educated, not on a special diet, and those who have a lower perception of the overall importance of nutrition when food shopping are generally less likely than their counterparts to perceive individual diet recommendations as important. Income, age, and body mass index also are significant factors for some individual healthy diet recommendations. Understanding consumers' perceptions about the importance of choosing healthy diets is an important preliminary step in changing dietary behavior and nutrition policies. Given worldwide trends toward Westernized diets and resulting increases in related health problems, the findings of this study may have relevance not only in the US but also globally.     

Steering the Sales Force for New Product Selling: Why Is it Different,and How Can Firms Motivate Different Sales Reps?

This study investigates how to direct and assemble the sales force for new product selling. In a first step, the authors draw on self‐determination theory to explore and empirically test a threefold conceptualization of motivation. Results provide insights into why sales force steering works differently in the new product selling context. Specifically, results show that for new products’ financial performance, internalized new product selling motivation is more important than intrinsic and controlled motivation. In a second step, the authors show how firms can motivate different sales reps to achieve higher financial performance of new products. In doing so, they examine the interaction effects of sales reps’ predispositions and widespread firm‐steering instruments on new products’ financial performance. Results reveal that the new product sales orientation of the bonus strengthens the positive relationship between sales reps’ performance predisposition and new product financial performance but weakens the relationship between sales reps’ learning predisposition and financial new product performance. Moreover, results reveal that the new product sales orientation of the periodic review strengthens the positive relationship between sales reps’ learning predisposition and financial new product performance. A post hoc analysis shows that a differentiated steering approach that matches appropriate steering instruments with sales reps’ varying predispositions substantially enhances reps’ financial new product performance.     

Soft drink prices,sales, body mass index and diabetes: Evidence from a panel of low-, middle- and high-income countries

We take advantage of four different cross-country datasets containing data on 78 countries for the period 1999–2014, in order to assess the relationship of carbonated soft drinks’ sales, as well as their prices, with body mass index (BMI), overweight, obesity and diabetes. Using an ecological study design and multivariate regression longitudinal estimation approaches, we find that carbonated soft drink sales were significantly positively related to BMI, overweight and obesity – but only in the low and lower-middle income countries. This finding was robust to a number of sensitivity and falsification checks. In this sub-sample, an increase in per capita soft drink sales by 1 litre per year was related to an increase of BMI by about 0.009 kg/m² (p < 0.1).. This is a small effect, implying that halving annual consumption per capita in this group of countries would result in a drop of BMI by only about 0.03 kg/m². Although soft drink prices were negatively related to weight-related outcomes in the sample of higher middle income and high income countries, this finding was not robust to falsification checks. The results thus suggest that sales restrictions to steer consumers away from soft drinks could indeed have a beneficial health effects in poorer countries, although the effect magnitude appears to be very small. However, given potential limitations of using ecological research design, results from individual level studies would be required to further ascertain the role of soft drink sales and prices in obesity and diabetes.     

Efficiencies,market power and horizontal merger

In June 1982 the Justice Department issued itsMerger Guidelines which specify in terms of the Herfindahl index (H) what combinations of merger size and post-merger H are likely to lead to a merger challenge. This paper assesses theseGuidelines using Williamson's (1968) well-known model in which an optimal merger policy is viewed as one that considers both the price and cost consequences of merger. The Williamson model is recast in terms of H and changes in H and linked to theGuidelines. This allows an assessment of the welfare congequences of an industry merger for any given level of concentration and merger-produce changes in concentration. Among the conclusions are that, consistent with theGuidelines, higher values of H make socially successful mergers less likely, and a more appropriate, if perhaps not more feasible, focus for theGuidelines are coordination adjusted measures of concentration and merger size.     

Search algorithm,repetitive information,and sales on online platforms

A prominent feature of online sales is that buyers rely on the search tools offered by platforms to process information when searching for products. We develop a model that captures how the search algorithm affects buyers’ search processes, which further influences market equilibrium and welfare. If a platform adopts a highly unequal search algorithm, buyers are likely to obtain repetitive information about a small group of sellers, which causes buyers to consider fewer options and suppresses competition. By using data from food delivery platforms, we provide empirical evidence that markets with less equal distributions of store rankings in search results have higher average prices and more concentrated sales. We suggest that regulators should restrict search algorithms from showing repetitive information.     

产品兼容、网络效应与企业竞争力

在网络效应较强的产业中，技术设置的兼容性是左右企业成长的关键因素。随着技术进步、新兴产业的发展和市场竞争的加剧，产品兼容、网络效应对企业竞争力具有越来越重要的意义。在计算机、电信、银行、旅游、媒体、软件等产业中，用户在购买时十分注重产品或服务的兼容性和网络效应。本文以差异产品竞争模型为基础，考察了产品兼容、网络效应对企业竞争力的影响，就在位企业和新进入企业如何利用这两个产品差异变量增强其竞争力进行了分析。     

On the relation between multimarket contact and service quality: Mutual forbearance or network coordination?

Research summary : We reconsider the relationship between multimarket contact and product quality in the airline industry by arguing that multimarket contact has both a negative mutual forbearance effect on quality and a positive network coordination effect on quality. Multimarket contact increases the frequency of contact between firms, and this anticipated future interaction promotes cooperation. In network industries, especially small firms may want to cooperate in order to increase the attractiveness of the composite product. By using size as a moderating variable, we indeed find a consistent positive effect of multimarket contact on product quality for small airlines. We show that this effect can be attributed to network coordination and that this effect generally dominates the negative mutual forbearance effect in a recent period. Managerial summary : Firms with sales in multiple geographical markets likely encounter each other with mutual respect (i.e., live and let live) because aggressive behavior in one market may lead to retaliatory responses in other markets. Such responses weaken competitive pressures on price and quality. Insofar these firms sell complementary products, they may however also coordinate and improve their joint product offering, resulting in better quality for the consumer. This paper shows that this positive effect of cooperation may dominate the negative competition‐reducing effect, depending on the size distribution of firms. The reason is that small or nondominant firms have a stronger incentive to produce compatible products than large or dominant firms with already a strong position in the (global) market. Copyright © 2015 John Wiley & Sons, Ltd.     

Salespersons as Internal Knowledge Brokers and New Products Selling: Discovering the Link to Genetic Makeup

Managers increasingly realize the importance of involving the sales force in new product development. However, despite recent progress, research on the specific role of the sales force in product innovation‐related activities remains scarce. In particular, the importance of a salespersons' internal knowledge brokering has been neglected. This study develops and empirically validates the concept of internal knowledge brokering behavior and its effect on selling new products and developing new business, and explores whether a salesperson's internal brokering qualities are determined by biological traits. The findings reveal that salespeople with the DRD2 A1 gene variant engage at significant lower levels of internal knowledge‐brokering behavior than salespeople without this gene variant, and as a result are less likely to engage effectively in new product selling. The DRD4 gene variant had no effect on internal knowledge brokering. Management and future research implications are discussed.     

Merger law,policy, and enforcement guidelines in Canada

The paper describes Canada's merger law, policy, and enforcement activity. The contents of Canada's recently issuedMerger Enforcement Guidelines are explained, analyzed, and compared to the U.S. Merger Guidelines. The roles of concentration, market share, entry conditions, and efficiency defenses in Canadian merger cases are assessed. Reference is made to some recent decisions of Canada's Competition Tribunal, a body created as a part of the major competition policy reforms contained in the 1986 Competition Act.     

Welcome contributor or no price competitor? The competitive interaction of free and priced technologies

The existence of free technologies is prevalent in a variety of industries from software to design. This study examines the competitive interaction between free and priced technologies. I draw on the literature on economic logics to predict that, in general, technologies that are freely shared are likely to stimulate interest and provide useful market information without directly competing with priced technologies. In contrast, due to direct competition, I predict that the prevalence of priced technologies will decrease the sales of other priced technologies. I find support for these hypotheses using a sample of more than 1 million transactions in over 200 distinct markets for MobileApps for the Palm computing platform. This study highlights how free technologies can be utilized to enhance performance of commercial producers. Copyright © 2015 John Wiley & Sons, Ltd.     

Entrepreneurship,innovation, and political competition: How the public sector helps the sharing economy create value

Research Summary: With the recent growth of the sharing economy, regulators must frequently strike the right balance between private and public interests to maximize value creation. In this article, we argue that political competition is a critical ingredient that explains whether cities accommodate or ban ridesharing platforms and that this relationship is moderated in more populous cities and in cities with higher unemployment rates. We test our arguments using archival data covering ridesharing bans in various U.S. cities during the 2011–2015 period. We supplement these data with semistructured interviews. We find broad support for our arguments while mitigating potential endogeneity concerns. Our study has important implications for nonmarket strategy, entrepreneurship and innovation, and public-private partnership literatures. In addition, our findings inform policy debates on the sharing economy. Managerial Summary: Entrepreneurs and businesses oftentimes face severe regulatory barriers when commercializing innovative products and services even if the innovations are generally beneficial for consumers and the broader society. This research focuses on the political determinants of regulation to provide a better understanding of why some markets are more receptive to innovative products while other markets are more hostile to them. Using the banning of ridesharing companies (e.g., Uber and Lyft) in various U.S. cities during the 2011–2015 period, we find that elected politicians facing less political competition (i.e., not easily replaceable, serving multiple terms, longer tenure in office) were more likely to ban ridesharing companies and favor, potentially displaceable, local taxicab companies. Our research has implications for navigating the political barriers to entry.     

Joint product management strategies for E. coli O157 and feedlot profits

The objective of this study was to investigate the associations of management strategies on Escherichia coli O157 and feedlot profits. Management practices that affect cattle performance were identified using ordinary least squares regressions, while a negative binomial regression was used to identify management practices that were associated with E. coli O157 prevalence. Findings support the hypothesis that E. coli O157 occurrences in the feedlot were not directly associated with cattle performance in the feedlot, which suggests potential for a downstream production externality problem. General categories of management strategies were associated with cattle performance and E. coli O157 occurrences and were consistent with past research. As implementation of enhanced food safety regulations potentially shift responsibility of ensuring safety of the food supply from a government based agency onto private firms, a portion of the costs of E. coli O157 outbreaks is likely to shift to feedlots in the future.     

Competition,governance, and relationship‐specific investments: Theory and implications for strategy

This paper uses biform games to examine the endogenous decision to invest in relationship‐specific assets. It addresses the questions of how competition affects suppliers' decisions to produce a general‐purpose product or a relationship‐specific product for a buyer and under what circumstances a governance arrangement designed to share investment costs between the transacting parties increases the investment in relationship‐specific assets. We offer a balanced perspective that emphasizes both the superior transaction value of relationship‐specific products and their high transaction costs while considering the competition effects generated by alternative investment plans. The model and its extensions generate new insights into investment decisions regarding relationship‐specific assets. Copyright © 2013 John Wiley & Sons, Ltd.     

Palm oil and dietary change: Application of an integrated macroeconomic,environmental, demographic,and health modelling framework for Thailand

Palm oil is a cooking oil and food ingredient in widespread use in the global food system. However, as a highly saturated fat, palm oil consumption has been associated with negative effects on cardiovascular health, while large scale oil palm production has been linked to deforestation. We construct an innovative fully integrated Macroeconomic-Environmental-Demographic-health (MED-health) model to undertake integrated health, environmental, and economic analyses of palm oil consumption and oil palm production in Thailand over the coming 20 years (2016–2035). In order to put a health and fiscal food policy perspective on policy priorities of future palm oil consumption growth, we model the implications of a 54% product-specific sales tax to achieve a halving of future energy intakes from palm cooking oil consumption. Total patient incidence and premature mortality from myocardial infarction and stroke decline by 0.03–0.16% and rural-urban equity in health and welfare improves in most regions. However, contrary to accepted wisdom, reduced oil palm production would not be environmentally beneficial in the Thailand case, since, once established, oil palms have favourable carbon sequestration characteristics compared to alternative uses of Thai cropland. The increased sales tax also provokes mixed economic impacts: While real GDP increases in a second-best Thai tax policy environment, relative consumption-to-investment price changes may reduce household welfare over extended periods unless accompanied by non-distortionary government compensation payments. Overall, our holistic approach demonstrates that product-specific fiscal food policy taxes may involve important trade-offs between nutrition, health, the economy, and the environment.     

PARALLEL TRADE,INTERNATIONAL EXHAUSTION AND INTELLECTUAL PROPERTY RIGHTS: A WELFARE ANALYSIS*

This paper analyses the issue of parallel trade (arbitrage) for products protected by intellectual property rights. We discuss a basic trade‐off that arises between the ex post better allocation that typically occurs under parallel trade when demand dispersion is not too high, and the ex ante reduced product quality because of lower investment. We show that the size of the welfare effects is significantly affected by the presence of a ‘generic’ product, which represents a form of competition for the monopolist. The monopolist will introduce a ‘fighting brand’ to compete with the generic, which dilutes but does not eliminate the result on the adverse effects of parallel trade on investments.     

BESTSELLER LISTS AND PRODUCT VARIETY*

This paper uses detailed weekly data on sales of hardcover fiction books to evaluate the impact of the New York Times bestseller list on sales and product variety. In order to circumvent the obvious problem of simultaneity of sales and bestseller status, the analysis exploits time lags and accidental omissions in the construction of the list. The empirical results indicate that appearing on the list leads to a modest increase in sales for the average book, and that the effect is more dramatic for bestsellers by debut authors. The paper discusses how the additional concentration of demand on top‐selling books could lead to a reduction in the privately optimal number of books to publish. However, the data suggest the opposite is true: the market expansion effect of bestseller lists appears to dominate any business stealing from non‐bestselling titles.     

The Effect of Graduated Response Anti‐Piracy Laws on Music Sales: Evidence from an Event Study in France

Despite the problem that filesharing poses to the creative industries, there is little research on the effectiveness of governmental anti‐piracy policies. This study analyzes how the HADOPI ² graduated response law in France affected digital music sales. Using a panel of sales data from the four major labels, we applied a difference‐in‐difference approach, comparing sales trends in France to a control group of European countries. We find that increased consumer awareness of HADOPI caused French iTunes music sales to increase by 22‐25%. The observed sales increase is larger in high piracy genres than low piracy ones, strengthening the causal interpretation of our results.     

Towards a food and nutrition policy for Australia,an environmentalist view

The state government of Victoria, Australia, recently prepared a discussion paper towards a regional food and nutrition policy. This evaluation finds it deficient in various ways. The critique contains recommendations for the building of a national food policy. The commission report displays a lack of a systems view of the problem of nutrition, which would recognize a diversity of influences on eating (e.g. social frameworks and frameworks by which we think and know). Linear causality is not an adequate concept. Agribusiness impacts heavily on the environment. In the case of meat production, inputs to production far exceed food energy outputs. Disposal of the by-products of meat production is also more problematic. The way to impact on these wasteful and destructive industrial practices is to consume less meat. Additives in food are a serious problem not well enough addressed. This and other processing increase the cultural perception of foodstuffs as human artifacts. Awareness of the cultural role of foods would allow Australians to cope with industry campaigns promoting meat and processed foodstuffs. There should be more attention to mutual impacts of environment, consumptiuon, and additives and processing. Food from low in the food chain (cereals, seafood) should be promoted not as substitutes but as foods in their own right. Commission recommendations should deal with questions such as nutritional information labeling of foods, and especially an attempt to foster consciousness of the environmental impact of food consumption: Government policy should be mindful to the extent possible of the impact on poor areas of the world of wasteful food consumption in Australia. Proposals for action should benefit from the impact of several fields of expertise beyond health, agriculture, consumer affairs and others; for instance, anthropology or environmental science.