Generic Advertising; and the Structural Heterogeneity Hypothesis

This paper adduces and tests the hypothesis that generic advertising responses are dynamic, i.e., are subject to change over time due to changes in target audiences, managerial expertise, copy quality or other time-related factors. Specifically, the authors consider the structural heterogeneity hypothesis from the perspective of three alternative econometric models that permit random and systematic time-varying response: the Prescott-Cooley model, the return-to-normality model, and the stochastic-trend model. A distinguishing characteristic of the models is the presence or absence of heteroscedasticity. Based on pretests, which failed to detect heteroscedasticity, a modified version of the stochastic-trend model is selected for hypothesis testing. Results based on data of the first 15 years of the Ontario fluid milk campaign suggest advertising responses are dynamic. Estimated advertising elasticities decline more or less monotonically over this sample period, from a high of 0.020-o.031 in the initial 1973–74 theme period, to a low of 0.0004-0.009 in the final 1986–87 theme period. The apparent declining effectiveness of the Ontario fluid milk campaign is consistent with wearout theory, and suggests that program managers may want to reassess marketing strategies to identify possible ways to improve performance. Given the importance of advertising elasticities in normative decision models and the growing evidence of structural heterogeneity, models that permit parameters to change over time should provide an improved basis for program assessment and resource allocation.     

Us consumer product marketing in Saudi Arabia: Comparative perceptions

The period between 1970 and 1990 has seen a steady decline of the market share of US products in Saudi Arabia. This article deals with the differing perceptions of US exporters and Saudi importers regarding factors that might have contributed to this decline. These factors include the marketing environment, the product, the price, the distribution, US business practices, advertising, trade policies and the market situation in Saudi Arabia, and the role played by the US government. An analysis of these factors has led to a series of recommendations to respective governments and businesses.     

Search cost,trading strategies and optimal market structure

The theory of Walrasian equilibrium yields a set of prices at which the aggregate competitive demand for each commodity equals its aggregate competitive supply. However, even at equilibrium prices the theory of competitive equilibrium does not explicitly offer explanation regarding the manner in which trades are actually executed. This paper considers a model where trade takes place in a decentralized fashion and examines in a dynamic game-theoretic framework, the role of social institution of money and markets in facilitating exchange. The steady state Nash equilibrium derived in the paper demonstrates how, depending on the level of transaction costs associated with a market setup (synonymously, trading posts to exchange possible pairs of goods) appropriate monetary trade emerges, which like a hub and spoke network (Starr and Stinchcombe, 1999) makes some markets non-functioning and in equilibrium only the markets having trade through the medium of exchange continue to exist. However, despite the obvious advantages of a market setup in reducing search costs, pure random search for a complementary trading partner (as considered by Ostroy and Starr, 1974; Kiyotaki and Wright , 1989; and others) prevails in many economies, especially, in many developing economies. This paper models this feature of developing economies by introducing differences in transaction costs across agents and shows why sustainable equilibria might exist exhibiting random search for certain commodities even in the presence of established markets.     

Feasibility Criteria in Monetary Trade

Consider the problem of how agents in a pure exchange competitive framework acquire their desired bundles of goods through a process of decentralized trade, i.e., in the absence of an auctioneer. Since the agents' wants are not mutually coincident, a medium of exchange is necessary to conduct trade. One relevant question to ask in this context is what property a commodity should possess in order for it to be eligible as a medium of exchange? This note discovers one such attribute, that the good be included in the final consumption vector of each agent. The condition is an improvement over an earlier one due to Ostroy and Starr (1974) which requires each agent to have large quantities of the medium of exchange in her/his initial endowment of commodities. JEL Classification Numbers: D50, E42.     

Promoting entrepreneurship to alleviate poverty in India: An overview of government schemes,private‐sector programs,and initiatives in the citizens' sector

In recent years, entrepreneurship has achieved significance as a driver of economic growth and poverty alleviation. This article focuses on various initiatives and entities that promote capacity building and entrepreneurship development among the poor in India and pays special attention to examining the ways in which these entities can better coordinate their efforts. The article first reviews the general literature on entrepreneurship and poverty eradication followed by a conceptual framework that models the efforts of the Indian government, the private sector, and the citizens' sector in promoting entrepreneurship and capacity building. This conceptual framework is utilized to discuss efforts of social entrepreneurs and self‐help groups (SHGs) in India as well as to present a general sectoral assessment of the poverty‐alleviation schemes in the subcontinent. The article's conclusions emphasize that neither markets alone nor governments alone are enough to eradicate poverty, especially in the Indian context. Instead, a trisectoral approach that recognizes the complementarities between the government, the private sector, and the citizens' sector and encourages these sectors to collaborate may be vital to the common goal of capacity building among India's poor. © 2012 Wiley Periodicals, Inc.     

Buyer Collusion and Efficiency of Government Intervention in Wheat Markets in Northern India: An Asymmetric Structural Auctions Analysis

This article uses auction theory to analyze wholesale markets for wheat in Northern India. This approach enables us to characterize the market in terms of buyer asymmetries, to detect the existence of collusion, and to quantify its impact on market prices. We show that buyer asymmetries exacerbate the downward impact of collusion on prices. The article also considers whether the government paid too much for the wheat it procured at the minimum support price, and shows that for our sample it did not. The article is based on a primary survey of two wholesale markets in North India.     

Impact of Economic Reforms on Economic Issues: A Study of Ethiopia

Abstract: This paper is an attempt to investigate the impact of economic reforms on the economic issues in Ethiopia. Different economic issues — parameters determining the effectiveness of economic reforms — are separately discussed to measure how far Ethiopia has benefited from the reform policy. A simple and comparative analysis of various economic indicators between the pre‐reform and post‐reform, that is, between 1985/86–1991/92 and 1992/93–2001/02, reveals that those economic reforms have revamped the economy by moving its GDP from its long‐standing poor record to a respectful growing state. Nevertheless, the reforms have failed in attaining other direct economic objectives, such as standard of living, external debt, trade balance deficit and current account deficit. Economic reforms have, no doubt, attracted a significant amount of private investment, but its volume started declining within the reform period and so were privatization proceeds. This study suggests that a full‐fledged and committed reform is indispensable at the earliest to attaining the full benefits of reform policy.