IS FINANCIAL SUPPORT FOR PRIVATE R&D ALWAYS JUSTIFIED? A DISCUSSION BASED ON THE LITERATURE ON GROWTH

Many economists have long held that market failures create a gap between social and private returns to research and development (R&D), thereby limiting private incentives to invest in R&D. However, this common belief that firms significantly underinvest in R&D is increasingly being challenged, leading the rationale behind public support for private R&D to be questioned. In this paper, we attempt to clarify the perspectives of two sources: the theoretical literature on endogenous growth, and its recent developments in integrating a geographical dimension, and the empirical literature that measures the social returns to R&D in relation to the private returns. Ultimately, we are able to clearly distinguish among different types of market failures and compare their relative impact on the gap between the private and social returns to R&D. Two main conclusions are reached. First, systematic firm underinvestment in R&D is not demonstrated. Second, even though instances of underinvestment do occur, they are mainly explained by surplus appropriability problems rather than by knowledge externalities. This suggests the need for a new policy mix that employs more demand‐oriented instruments and is more concentrated on identifying efficient allocations among activities rather than merely increasing global private R&D investment.     

Boys do not cry: the negative effects of brand masculinity on brand emotions

Marketing Letters - Building on the literature on gender role theory and brand gender, this research examines how gender-based stereotypes regarding emotional behaviors can influence...     

Remanufacturing for the Circular Economy: An Examination of Consumer Switching Behavior

For the circular economy to be tenable, consumers need to not only return products after use, but also purchase products that are remanufactured. However, research finds that consumers have a poor opinion of remanufactured products and are typically not prepared to adopt them. Thus, development of the circular economy is dependent upon deeper understanding of consumers’ attitudes and behaviors. Research typically considers either micro‐level or macro‐level factors when assessing consumer perceptions of remanufactured products. The current research incorporates macro‐level factors of price, government incentives and environmental benefits with the moderating influence of micro‐level consumer attitudes to examine consumers’ intention to switch from purchasing new products to remanufactured products. The findings suggest that a consumer's attitude toward remanufactured products is an important moderating factor predicting consumer switching behavior to remanufactured products. Copyright © 2016 John Wiley & Sons, Ltd and ERP Environment     

The rhetorical fantasy of energy transitions: implications for energy policy and analysis

This article explores the rhetoric of four energy transitions. It begins by summarising research on the intersection of fantasy, technology and the sociology of expectation. It then looks at how ideas of progress, modernity, cheapness, abundance and hope influence the way society perceives new energy technologies, causing them to overestimate benefits and underestimate challenges. Our rhetorical analysis finds in case studies of steam engines, gasoline automobiles, hydroelectric dams and nuclear reactors that newly ‘discovered’ sources of energy or newly invented technologies are always assumed to provide infinitely abundant energy and to have the potential to create positive utopian changes in society. We conclude by noting the salient implications of these rhetorical themes for energy planners, analysts and scholars.     

Integrating partitioned prices via computational estimation

This paper introduces computational estimation to the literature on consumers’ numerical cognition. Computational estimation involves simplifying an arithmetic problem via mathematical procedures to produce an approximate answer. Employing calculation knowledge and approximation together, consumers are likely to use computational estimation as it is relatively accurate while saving cognitive effort compared to calculating values. Three studies applied to partitioned prices in the form of a base price and a percentage discount, demonstrate that when faced with this numeric integration task, the strategy consumers undertake is dependent on the characteristics of the numerals with discounts that are round or close to round being associated with greater use of computational estimation. Further, when employing computational estimation, consumers arrive at more accurate, and lower, price estimates in which they place more confidence than when using alternative an integration strategy. As a result, discounts that are near a round value are preferred to those that are not; a result that is dependent upon the use of computational estimation.     

Consumer Preferences for Coffee: Hot and Wet,or Quality and Flavor?

An econometric model is developed and estimated for all brands of coffee sold at the retail level in four supermarkets in Columbus, Ohio. These brands are segmented into 24 categories, and the four stores are classified into two groups, inner-city and suburban, based on 2010 census tract data. Using estimated measures of price-sensitivity, these 24 categories are further segmented into four groups to help guide and clarify the discussion. Estimated results show different purchasing patterns and different levels of price-sensitivity for inner-city and suburban shoppers. Further, these purchasing patterns and levels of price-sensitivity suggest alternative marketing strategies for retailers. Private-label coffee brands are shown to be quite competitive with many national brands, and indeed private-label brands command a market share among inner-city shoppers that is more than double that for the nation (21.95% vs. 9%).     

Regulation and taxation: A complementarity

I show how quantity regulation can lower elasticities and thereby increase optimal tax rates. Such regulation imposes regulatory incentives for particular choice quantities. Their strength varies between zero (laissez faire) and infinite (command economy). In the latter case, regulation effectively eliminates any intensive behavioral responses to taxes; a previously distortionary tax becomes a lump sum. For intermediate regulation (where some deviation is feasible), intensive behavioral responses are still weaker than under zero regulation, and so quantity regulation reduces elasticities, thereby facilitating subsequent taxation. I apply this mechanism to labor supply and present correlational evidence for this complementarity: hours worked in high-regulation countries are compressed, and these countries tax labor at higher rates.     

Reasonable and Risk‐Based? Replacing NFIP Generally Subsidized Rates with a Means‐Tested Subsidy

The National Flood Insurance Program was created to seek two often conflicting goals: (i) shifting risks from federal taxpayers to those who choose to live in flood plains and (ii) ensuring flood insurance is available to everyone at “reasonable” rates. Efforts to accomplish the second goal currently take the form of subsidies based on location and the date a home was constructed. The resulting revenue from subsidized insurance premiums is not sufficient to cover the true cost of flood insurance, and federal taxpayers have paid the difference: $30 billion to date. Based on a detailed survey of households in the high‐risk flood zones of New York City (NYC), we find that replacing existing premium subsidies with risk‐based prices and a subsidy for low‐income housing‐burdened households could better meet both goals by ensuring low‐income individuals have access to affordable flood insurance while still saving the federal taxpayer up to $183 million per year in NYC alone.