Estimating market power using a composed error model

We present a maximum likelihood based composed error model to estimate market powers of firms. In our model, the stochastic part of the supply relation includes two random components: the conventional two‐sided error term and a random term, which is capturing firm‐specific conducts. Moreover, we provide a generalization of scaled Stevenson stochastic frontier model in the context of doubly truncated normal distributions. We estimate the market powers of Chicago based airlines as an empirical example that is showing the applicability of our estimation procedure.     

Manipulation Through Biased Product Reviews*

We study a signal-jamming model of product review manipulation in which rational consumers consult product reviews and price to better estimate a product's quality, and a firm, whose quality is either high or low, chooses its price and how much bias to insert into product reviews. We show that both firm types always exert positive effort to manipulate product reviews, and, depending on the equilibrium price level, one or both of them can increase its sales. When the high-type firm exerts more effort than the low-type, review manipulation benefits consumers by raising [lowering] their demand for the high-quality [low-quality] product.     

Working Conditions of the Child Worker in Turkish Labour Law

Child labor is one of the most important subjects related to work in Turkey. The children of the poor families feel the necessity to enter the work force. The necessity which stems from the economic hardship forces the child and adolescent workers to accept unhealthy working conditions. Having said that, it would be wrong to assume that the sole purpose of the children workers is to earn a living. Research indicates that another purpose is to learn a profession. There exist regulations that limit the child labor in Turkey. Through these regulations, several occupations are prohibited to be undertaken by child labor and reduction in working hours is enforced. The Labor Code that came into force in 2003 contains important regulations in this regard. The labor Code introduced important responsibilities to employers and unions. Turkey also took part in international agreements and working towards fulfilling her duty as a result of these agreements. Furthermore, Ministry of Labor and Social Security runs several programs tailored for child labor. IPEC Project is the important program among those. These programs involve not only the child labor, but also their families as well. To sum up, Turkey is aware of the fact that child labor is a social and economic problem. As a result, the efforts towards resolving the issue is ongoing and important steps are being taken towards the EU membership.

Strategic Product Line Choice under Asymmetric Demand Structure

We examine strategic product line choices of manufacturers in a stylised duopoly model where products have asymmetric and interdependent market conditions. We characterise the optimal product line decisions and show that manufacturers always prefer to have head‐to‐head competition (and never segment markets) when product line setup cost is small relative to profitability of the products. When setup costs are high, symmetric manufacturers may prefer to have asymmetric product lines or market segmentation. We show that high setup costs lead to the market segmentation outcome only if there is no significant market size difference and the level of product substitutability is moderate.     

A computer-supported collaborative learning (CSCL) approach in teaching research methods

The aim of this study is to evaluate the extent to which the engagement of hospitality students in computer-mediated asynchronous discourse in a postgraduate research methods course results in higher-order thinking. In order to identify their overall behavioural engagement in the discourse elements of the course, quantitative data from running the course in WebCT was obtained using the “track students” function. The threaded discussions were converted into text files and loaded in NVivo for content analysis. In addition, the students’ course evaluation questionnaires were used to assess their perceived benefits from the asynchronous discourse on research methods. This study shows that computer-supported collaborative learning allows students to become active and reflective learners by engaging in high order thinking activities. The results of this study highlight the options that hospitality management educators may consider as part of their teaching and learning strategies.     

A dictatorial domain for monotone social choice functions

We give a dictatorial domain for monotone and unanimous social choice functions.     

Do Stock Index Futures Affect Economic Growth? Evidence from 32 Countries

This article investigates the relationship between stock index futures markets development and economic growth using time-series methods for 32 developed and developing countries. Evidence of cointegration between stock index futures and real economy in 29 countries suggests the presence of co-movements among the variables, indicating long-run stationarity in those countries. Our findings show that there is Granger-causality from stock index futures markets development to economic growth for middle-income countries with relatively low real per capita GDP, and Granger-causality in the reverse direction for the countries with high real per capita GDP. Variance decomposition and impulse-response function (IRF) analyses results support the existence of a relationship between stock index futures and real economy.     

Cultural variations in the use of marketing signals: a multilevel analysis of the motion picture industry

Movies are experiential products that include a myriad of cultural cues, and their box office performance varies across countries with different cultural backgrounds. The profusion of studies on the motion picture industry notwithstanding, this aspect has been largely ignored in the literature. Drawing on signaling theory, this study examines how a country’s cultural fabric moderates the impact of movie-related signals on the opening weekend box office performance. We test our hypotheses using a multilevel model and a comprehensive dataset of 1,116 movies released in 27 countries between 2007 and 2011. Results reveal that the impact of star power on box office performance is amplified in high uncertainty avoidance and indulgent cultures, while it is attenuated in high power distance cultures. Moreover, the positive relationship between sequels and performance wanes in individualist cultures. Movies with high production budgets perform better in culturally open countries, while critics’ reviews are more instrumental in high uncertainty avoidance cultures.     

Benchmarking sales staffing efficiency in dealerships using extended data envelopment analysis

This study presents an approach to benchmark dealer performance in a business-to-business setting through a rigorous efficiency analysis of sales staff allocation. Using a series of basic and extended data envelopment analysis (DEA) models on data collected from a survey of self-reported financial and statistical information, this research assesses dealer efficiency and compares the efficiency scores to traditional financial benchmarking. Findings support the minimization of outsourcing services that are customer interactive and highly specific to a transaction to differentiate the dealer from its competition. Integrating the results from DEA models, manufacturers obtain a comprehensive view of allocating sales staff to increase dealer efficiency and generating a complementary approach to traditional financial ratio benchmarking in determining best practices to other dealers.