Effects of price sorting display on extreme option choice aversion: The role of ease of comparison in multiple option displays

Due to the popularity of online travel agency (OTA) booking platforms, OTAs display diverse information, including features of products, on their websites. Based on choice architecture literature, this study aimed to examine the effect of product quality and price sorting (vs. non-sorting) on extreme option choice aversion and identify the moderating effect of displays that made it difficult to read information. The results of a series of four experimental studies (total n = 2838 online panel members) demonstrated that the tendency to choose the non-extreme or middle-attributed options was stronger when quality and price were displayed sorted (vs. non-sorted). It was theorized that easy comparison of multiple options leads to decision-making. The positive effect of quality and price sorting on extreme option choice aversion was significantly reduced when customers had difficulty reading the displayed information.     

China and international market integration: Evidence from the law of one price in the Middle East and Africa

We model market integration in the Middle East and Africa by analyzing price dispersion and testing the law of one price (LOP) on highly-comparable actual local retail prices of 135 goods and services across 23 countries in the region over the period of 1990–2016. Second-generation panel estimators are applied to four price benchmarks: Regional average, South Africa, China, and US prices. Cross-regional price dispersion diminishes considerably over time up to 2008, particularly for non-tradeables around China price. The test of LOP indicates the percentage of convergent prices is highest in China price benchmark, followed by US, South Africa, and regional average benchmarks. Direct estimation of the convergence speed confirms this order. Overall, the results show evidence of increasing market integration in Middle East and Africa but it appears to be driven by global forces and, especially, the rise of China as a new economic power. The results show that some emerging market economies, such as China, can step up and promote integration while traditional economic powerhouses, such as the USA and UK, disengage from international economic relations.     

Persistence of Price–Cost Margin and Technical Efficiency in the Indonesian Food and Beverage Industry

Abstract

This research investigates the persistence of price–cost margin (PCM) and technical efficiency (TE) of firms and the relation between these two factors in 44 subsectors of the Indonesian food and beverage industry in the period 1980–2014. Data envelopment analysis with a bootstrapping approach is applied to estimate TE. An autoregressive model, accounting for endogeneity, is applied to estimate the persistence coefficients of PCM and TE. A cross-sectional regression model is also applied to estimate the relation between the persistence of the PCM and the persistence of TE. The results show that for these food and beverage firms, high PCM and low TE persist. Furthermore, the persistence of PCM negatively affects the persistence of TE in the industry.     

Revising price history: consumer price index for Norway 1492–2018

ABSTRACT

The paper presents a new combined annual cost of living and consumer price index for Norway covering 1492–2018, indicating that Norwegian price history has to be revised. The new historical price index is constructed on a significantly richer data material, which also makes it cover a longer period of price history than the existing one. This is made possible by the compilation of quantitative data from numerous sources, mostly originating from the eighteenth, nineteenth and early twentieth centuries, with grain prices stretching back to 1492. The new combined cost of living and consumer price index is constructed by a Laspeyres approach with shifting baskets for commodities and expenditure groups.

The index makes it possible to follow annual inflation and deflation in Norway for a period of 526 years. When comparing to existing indices, the new series reveals that revisions are needed in Norwegian price history. These make the historical price development more in line with those of the neighbouring countries and more in line with the pattern of wholesale prices.     

Effect of Price Change Alert on Perceptions of Hotel Attribute-based Room Pricing (ABP) versus Traditional Room Pricing (TRP)

Aside from marketing information on traditional room rates, hotels and online travel agents (OTAs) are trying a new pricing technique based on the attributes of guestrooms. This research investigates how attribute-based room pricing (ABP) differs from traditional room pricing (TRP) in influencing consumer reactions when consumers receive a price change alert before (vs. after) sales. Through a series of experiments, we found that TRP and ABP result in similar alert attitude, brand attitude, and visit intention for presale price change alert. However, ABP leads to more favorable results for postsale price change alert. We examined the underlying mechanism and found that perceived fairness mediates the effect of pricing strategy on brand attitude, price alert attitude, and visit intention for postsale alert only. This research provides hotel managers and OTA marketers with guidance on when to send either type of price change message to consumers.     

On pure-strategy Nash equilibria in price–quantity games

This paper examines the existence and characteristics of pure-strategy Nash equilibria in oligopoly models in which firms simultaneously set prices and quantities. Existence of a pure-strategy equilibrium is proved for a class of price–quantity games. If the demand function is continuous, then the equilibrium outcome is similar to that of a price-only model. With discontinuous demand and limited spillover, there are rationing equilibria in which combined production falls short of market demand. Moreover, there might again be an equilibrium reflecting the outcome of a price game. Competition in price and quantity thus yields Bertrand outcomes under a variety of market conditions.     

A neural network based price sensitive recommender model to predict customer choices based on price effect

The impact of price and price changes should not be ignored while designing algorithms for predicting customer choice. Consumer preferences should be modeled with consideration of price effects. Businesses need to consider for efficient prediction of an individual's purchase behaviour. Personalized recommendation systems have been studied with machine learning algorithms. However, the price-aware personalized recommendation has received little attention. In this paper, we attempt to capture insightful economic results considered in the marketing and economics disciplines by employing modern machine learning architecture for predicting customer choice in a large-scale supermarket context. We extract personalized price sensitivities and examine their importance in consumer behaviour. The employed data collected from a supermarket chain in Germany consists of implicit feedback based on customer-product interactions and the price of every interaction. We propose a two-pathway matrix factorization (2way-MF) model that is price-aware and tries to memorize customer-product interaction's implicit feedback. The proposed models achieve better model performance than standard Matrix Factorization models widely used in the industry. The approach was re-validated with data from supermarket chain in Taiwan. Other industries can adopt the proposed framework of modeling customer's preferences based on price sensitivity. We suggest that further research and analyses could help understand the cross-price elasticities.     

山高皇帝远:地理距离与上市公司股价崩盘风险的经验证据

鉴于信息不对称程度、制度实施成本和心理文化差异，文章提出"监管距离"假说，认为监管者和被监管者之间距离远近可以影响监管效果。实证分析中国沪深上市公司数据，文章从非对称风险视角出发，研讨了上市公司注册地距所在地中国证监会派出机构的地理距离对公司层面的股价崩盘风险的影响。我们发现，监管机构与上市公司总部的地理距离越远，该上市公司股价的崩盘风险越大。进一步分析发现，如果开通高铁或者上市公司所在地社会信任水平足够高，那么监管距离和崩盘风险的正相关关系是不显著的；如果监管负担严重或政府效率低下，那么监管距离和崩盘风险之间正相关关系更为显著。文章认为，地理距离具有监管信息效应、监管威慑效应和监管执行效应，能够影响股价崩盘风险。也就是说，"山高皇帝远"可以改变上市公司行为，提高金融监管效率不应忽视非正式制度的影响。     

Wage and price differences,technology gap and labor flow dynamics

The relationship between wage difference and relative employment is a very important issue in the field of economic structural change. An M-sector economic growth model is constructed in this paper to investigate the relationship between wage difference, price difference, technology gap, relative employment and sectoral dynamic change from the perspective of technologies. Labor flow is regarded as a decision-making behavior to maximize the benefits of economic agents. The benefits of labor flow mainly come from sectoral wage difference, and the costs of labor flow mainly come from the social resource expenditure during labor flow process. Our model illustrates that: (i) the relative employment is positively correlated with the real wage difference and technology gap; (ii) the sectoral dynamic changes coexist with the aggregate economic growth; (iii) increases in technology gap, and price and wage differences will stimulate labor migration, exacerbate the unbalanced growth of sectoral economies, and lead to faster and more effective aggregate economic growth.     

Price connectedness between green bond and financial markets

We study price connectedness between the green bond and financial markets using a structural vector autoregressive (VAR) model that captures direct and indirect transmission of financial shocks across markets. Using heteroskedasticity to identify the structural VAR model parameters, our empirical findings reveal that the green bond market is closely linked to the fixed-income and currency markets, receiving sizeable price spillovers from those markets and transmitting negligible reverse effects. We also show that, in contrast, the green bond market is weakly tied to the stock, energy and high-yield corporate bond markets. These findings have implications in terms of portfolio and risk management decisions for environmentally aware investors holding positions in green bonds.