Country-of-Origin Effects on Russian Wine Consumers

In recent years, Russia has experienced significant economic growth. The wine industry is among those most affected by increases in disposable income. As a consequence, Russian wine importers have widened the range at the upper end of the quality spectrum. In the current scenario, some key questions arise concerning consumer attitudes toward wine and the way it is perceived in this evolving market. This article attempts to investigate such concerns through a choice experiment approach conducted by means of a questionnaire-based survey submitted to 388 Russian households located in the country's three largest cities (Moscow, Saint Petersburg, and Novosibirsk). In the experiment, respondents were asked to choose their favorite wine among seven dry red wines. The stated choices are analyzed using a random utility model to obtain an estimation of the price effect through a triangular distribution. Our results indicate the presence of three distinct market segments in the Russian wine market: a segment with only high-quality, highly priced Italian and French wines, a medium-quality segment currently limited to Spanish wines, and a much lower quality segment of wines in which demand for alcohol is essentially satisfied.     

Foresight in corporate organisations

Strategy formulation is strictly intertwined with the analysis of the likely evolution of the business environment, in order to detect promptly the opportunities and the threats brought about by emerging trends and to deal with them properly (strategic foresight). Today many companies put much effort into strategic foresight, and also in the literature on strategy there is a growing attention to strategic foresight. However, it still seems there is a lack of a general framework of analysis that clearly defines how all the foresight activities should be carried out in a firm and should be integrated in an organic way, in order to support strategic decision makers at corporate, business and functional levels. This is the main issue we have taken into account through the study of some relevant European and US firms that have established foresight units, in order to deliver support for long term strategy formulation.     

Environmental uncertainty,foresight and strategic decision making: An integrated study

This paper explores how the foresight practices and techniques that might be used for coping with environmental uncertainty are coordinated throughout large corporations and how their results are used for supporting strategic decision making. Based on an in-depth and multiple study of several companies, we analyse the main characteristics of environmental uncertainty - complexity and dynamism - that shape companies’ approaches to strategic foresight and uncertainty management. We explore the impact of growing complexity and dynamism on these approaches and the role of prediction and control in their design and implementation. We outline a conceptual framework for strategic foresight activities - and their relationships with decision making under uncertainty - as a planned learning process about the future which enables managers not to know opportunities and threats in advance, but to detect them more promptly and to react more effectively as soon as they start emerging.     

Endogeneity and sample selection in a model for remittances

We estimate a remittance model in which we address endogeneity and reverse causality relationships between immigrants' remittances, pre-transfer income and consumption. In order to take into account the fact that a large share of individuals do not remit, instrumental variable variants of the double-hurdle and Heckit selection models are proposed and estimated by Limited Information ML; semiparametric extensions are considered as robustness checks. Our results for a sample of recent immigrants to Australia show that endogeneity is substantial and that estimates obtained by the methods previously employed in the literature may be misleading if given a behavioral interpretation.     

Using Flexible Taste Distributions to Value Collective Reputation for Environmentally Friendly Production Methods

In this paper, we investigate consumer preferences for various environmentally friendly production systems for carrots. We use discrete choice multi‐attribute stated preference data to explore the effect of the collective reputation of growers from an Alpine valley with an established reputation for its environmentally friendly production: Val di Gresta ‘the valley of organic orchards.’ Data analysis of the panel of discrete responses identifies unobserved taste heterogeneity for organic, biodynamic, and place of origin along with extra variance associated with experimentally designed alternatives. The assumed parametric taste distributions are each tested using the semi‐nonparametric specification proposed by Fosgerau and Bierlaire, while the null of normality cannot be rejected for organic and biodynamic production methods, though it is for the place of origin. The latter is found to be bi‐modal, with modes at each side of zero. The use of a flexible taste distribution increases the plausibility of this form of heterogeneity and it appears promising for future applied studies. Dans le présent article, nous avons examiné les préférences des consommateurs quant à divers systèmes de production écologiques de carottes. Nous avons utilisé des données sur les préférences déclarées, la valeur attendue et les choix discrets pour examiner l'effet de la réputation collective de producteurs dans une vallée alpine réputée pour sa production écologique: Val di Gresta, dite la ?vallée des vergers biologiques?. L'analyse des données de panel discrètes a fait ressortir une hétérogénéité inobservable des goûts quant à la culture biologique, la culture biodynamique et le lieu d'origine ainsi qu’une variance supplémentaire liée à des options expérimentalement conçues. Les distributions paramétriques hypothétiques des goûts sont testées à l'aide de la spécification semi‐non‐paramétique proposée par Fosgerau and Bierlaire (2007), tandis que l'hypothèse nulle de normalité(null of normality) ne peut être rejetée pour les méthodes de production biologique et biodynamique, bien qu’elle le soit pour le lieu d'origine. Cette dernière serait bimodale, avec des modes de chaque côté de zéro. L'utilisation d'une distribution des goûts souple augmente la plausibilité de cette forme d'hétérogénéité et semble prometteuse pour les études appliquées futures.     

Network planning of fuelling service stations in a near-term competitive scenario of the hydrogen economy

Hydrogen can be viewed as the flexible automotive fuel of the future. However, many issues related to its use have not been sufficiently investigated. One such issue concerns hydrogen logistics and distribution throughout a territory. One near-term scenario over the next decade is likely to include distribution procedures that are similar to those currently used for petrol products. In this scenario, the conversion of petrol service stations into hydrogen distribution points will progressively be implemented. Petrol companies will then represent one of the major categories of hydrogen producers. They will thus have to select, from a cost/benefit standpoint that accounts for competing companies expected to offer the same service throughout a territory, the most convenient and effective locations for hydrogen distribution. The current paper presents a model for planning a network of service stations of a given company within a competitive framework. A case study of a specific territory in northern Italy is presented and discussed.     

Remittances and the Brain Drain: Do More Skilled Migrants Remit More?

In most destination countries, immigration policies are tiltedmore and more in favor of skilled individuals. Whether thisshift hurts economic prospects in sending countries, as arguedby the traditional brain drain literature, is somewhat controversial.The most recent literature focuses on the link between skilledoutmigration and educational achievements in the home country.This article emphasizes a different channel. It considers theargument that skilled migrants raise economic welfare at homeby sending a relatively larger flow of remittances. While skilledmigrants typically earn more, and so might be expected to remitmore, they are also likely to spend more time abroad and toreunite with their close family in the host country. These secondtwo factors should be associated with a smaller propensity toremit. Thus, the sign of the impact of the brain drain on totalremittances is an empirical question. A simple model has beendeveloped showing that skilled migrants may indeed have a lowerpropensity to remit from a given flow of earnings. An empiricalequation of remittances is estimated as a measure of the braindrain in developing countries using the Docquier and Marfouk (2004)data set. Evidence is found that the brain drain is associatedwith a smaller propensity to remit.     

The incentive to give incentives: On the relative seniority of debt claims and managerial compensation

We show that the relative seniority of debt and managerial compensation has important implications for the design of remuneration contracts. Whereas the traditional literature assumes that debt is senior to remuneration, there are in reality many cases in which remuneration contracts are de facto senior to debt claims in financially distressed firms and in workouts. We theoretically show that risky debt changes the incentive to provide the manager with performance-related incentives (a “contract substitution” effect). In other words, the relative degree of seniority of managers’ claims and creditors’ claims in case a bankruptcy procedure starts is crucial to determine the optimal incentive contract ex-ante. If managerial compensation is more senior than debt, higher leverage leads to lower power incentive schemes (lower bonuses and option grants) and a higher base salary. In contrast, when compensation is junior, we expect more emphasis on pay-for-performance incentives in highly-levered firms.     

Bayesian Conjoint Choice Designs for Measuring Willingness to Pay

In this paper, we propose a new criterion for selecting efficient conjoint choice designs when the interest is in quantifying willingness to pay (WTP). The new criterion, which we call the WTP-optimality criterion, is based on the c-optimality criterion which is often used in the optimal experimental design literature. We use a simulation study to evaluate the designs generated using the WTP-optimality criterion and discuss the design of a real-life conjoint experiment from the literature. The results show that the new criterion leads to designs that yield more precise estimates of the WTP than Bayesian D-optimal conjoint choice designs, which are increasingly being seen as the state-of-the-art designs for conjoint choice studies, and to a substantial reduction in the occurrence of unrealistically high WTP estimates.