Selling Versus Leasing of Durable Goods: The Impact on Marketing Channels

While many durable products are sold through intermediaries, there is limited understanding of how channel performance is influenced by transactions involving durable goods in a competitive market. In particular, extant research shows that intermediaries can significantly impact the leasing versus selling policy of a monopolistic manufacturer. This article seeks to fill that gap by examining the selling versus leasing choice of duopolistic manufacturers in the context of decentralized channels. Our analysis demonstrates that in addition to the unique equilibrium of selling, a prisoner's dilemma may arise where both manufacturers are better off if they were to lease their products.     

The Pro-competitive Effect of Two-Part Tariffs

Two producers delegate sales of differentiated products to common retailers, each with a monopoly position. Each producer can offer either a linear or a two-part tariff. In the single-period game each producer's dominant strategy is to use a two-part tariff. If the two producers' products are sufficiently close substitutes and the discount factor is sufficiently high, both producers offering linear tariffs can be sustained as an equilibrium outcome in an infinitely repeated game.     

Ethics at the workplace

Are facts the only criteria that should determine an arbitrator's decision but are there other ethical criteria that ought to be used? Arbitrators are often faced with deciding issues like whether a person discharged already by a company for arson, should be reinstated or not to his old job. The problem, however, may not be the facts but that the company has discharged him to get rid of him so that it no longer has a problem while society does with the arsonist at work elsewhere. Another problem involves the teaching of human resources management. Most of the current literature dealing with modern management reflects the belief that participatory management is good for management. Most of the evidence supporting such a claim is weak; there surely is very little evidence that such participation should include nonsupervisory employees. The discussion concerning the issue of participatory management could be raised if the participants stopped talking about the increased productivity that is supposed to result, but rather deal instead with the issue that such participation is a form of industrial democracy and therefore is good or bad depending upon a person's ethical judgments concerning such an issue.     

PARADIGM DEPLETION,KNOWLEDGE PRODUCTION AND RESEARCH EFFORT: CONSIDERING THOMAS KUHN'S IDEAS

This paper deals in a Stackelberg differential game with Kuhn (1962) ideas of paradigm depletion and resiliency. Paradigm is considered as potential knowledge, as a stock of ideas that can be harvested to produce science. The results are: (i) paradigm depletion can be optimal, (ii) the optimal editor's shadow price of potential knowledge must be non‐positive, if it is positive, the editor is a keeper of the orthodoxy rather than a scientist, (iii) editor's and/or researcher's impatience is bad for science, and (iv) in equilibrium editor's behavior does not matter for research effort, while only editor's behavior matter for the paradigm.     

PRICE DETERMINATION IN POLYPOLISTIC MARKETS AND EXCHANGE RATE CHANGES

A number of extensions of monopolistic competition to international trade have proved able to account for observed deviations from models of perfect competition. New fundamental research has questioned the concept of perfect competition by investigating firms’ decisions directly, with results quite similar in spirit to Kahn's idea of a “polypolistic market”. This paper follows this latter route; it presents a model of a firm's price and output decisions under uncertainty which produces the typical behavior of monopolistic competition even in a homogeneous industry. The model yields insights into the issue of the price and quantity effects of nominal changes in exchange rates.     

Does ownership of an end-of-life product affect design for environment?

Circulative use of resources is a crucial concept for a modern capitalist economy. Faced with peaking-out of material resources and shortage of landfill capacity in the long run, human beings are required to promote efficient reuse and recycling of end-of-life products (ELPs). One of the methods to advance efficient reuse and recycling is rental or lease of products. Product service is also a similar idea. All these imply, in some sense, a change of ownership of a product and an ELP; ownership of an ELP as well as a product belongs to producers instead of households. It is often said that such a change of ownership promotes design for environment (DfE) or eco-design, contributing to circulative use of resources. This paper examines whether ownership of an ELP affects DfE by means of à la Sraffian type of equilibrium model. I show that there are two routes to DfE, namely via a reduction of the amount of an ELP and enhancement of quality of a secondary material. I also show that DfE effects do not appear under certain conditions, even if the ownership of an ELP is transferred to producers.     

Advertising and Product Quality: Are Heavily Advertised Products Better?

It is often conceded that heavily advertised products cost more than those that are not advertised extensively. But there is considerable disagreement concerning what this difference means. Advertising's critics often claim it is evidence of monopolistic control over supply and prices, while advertising's defenders generally contend it reflects the higher quality of advertised brands. Surprisingly, there has been almost no research into whether or not heavily advertised goods are of better quality. As a preliminary inquiry into this interesting question, this paper attempts to examine the relationship between advertising expenditures and product quality.     

Sweetening the Transition in EU Sugar Preferences: The Case of Fiji

The European Union grants preferential market access for sugar to a group of African, Caribbean and Pacific (ACP) countries. Sugar exported under these quotas receives between two and three times the world price. These trade preferences are intended as a form of aid, but they tend to stifle productivity growth in the recipient countries. The European Union could better assist ACP countries by providing direct development assistance in place of sugar subsidies, for example by investing the aid transfers into infrastructure or other essential public services. This paper tests this proposition for the case of Fiji using a computable general‐equilibrium model. It is found that significant gains in economic performance can be achieved by employing such alternative strategies for aid. These gains are particularly strong over the medium to long term when the aid funds are diverted to infrastructure development. However, there are issues of equity to consider since, in the case of Fiji, the rural poor would be the losers if trade preferences were to be removed. Moreover, the degree of benefit in alternative strategies such as infrastructure development will be contingent on the economy's flexibility, which in turn depends upon the country's regulatory regime and education performance.     

Sources of Information,Consumer Attitudes on Nutrition,and Consumption of Dairy Products

Commodity promotion programs, paid for by producers, may be a source of nutrition information for consumers. The analytical approach treats sources of nutrient and health information, consumers' attitudes, and behaviors sequentially. The National Dairy Board's promotion of the calcium-related benefits of dairy products is one case where nutritional messages, through their impact on attitudes, do effect change in dietary behavior.     

From a Theory to a Paradigm: Examining the Eclectic Paradigm as a Framework in International Economics

Over the course of a quarter of a century, the eclectic paradigm has derived its strength from being a general framework of analysis that explains the level and pattern of foreign value-added activities of firms, and/or of countries, and allows for the co-existence of complementary and alternative theories in the discipline of international economics in a logically consistent manner without being inextricably wedded to any one particular approach. The current study aims to support such broad theoretical appeal of the paradigm by refining its theoretical interpretations of the concepts of ownership advantages and internalisation. To support its view that asset ownership advantages are both competitive advantages and monopolistic advantages, the theoretical interpretation of asset ownership advantages in the paradigm needs to be broadened from a narrow emphasis on Bain-type monopolistic advantages which enable firms to erect barriers to entry to new competition and exercise monopoly power in final product markets. It must also accommodate the theoretical perception of asset ownership advantages as part of the rivalrous behaviour or competitive process between firms consistent with the approach of Cantillon and the classical economists starting with Adam Smith, the Austrian economists such as Schumpeter and Hayek, as well as Penrose. The eclectic paradigm must also effectively address the important distinction between 'internalisation of ownership advantages or intermediate products' and the 'internalisation of the markets for ownership advantages or intermediate products' within the context of endogenous structural market imperfections in final products and exogenous transactional market imperfections in intermediate products. In clearly distinguishing between the alternative interpretations of the concepts of ownership advantages and internalisation, the paradigm could more effectively synthesise alternative theories of the firm and the multinational corporation in one cogent framework of economic analysis.     

Quality disclosure in the presence of strategic consumers

Consider a market for short-life products, such as smartphones, where a firm and consumers have asymmetric quality information, the firm sells products in two periods, and consumers make purchase decisions strategically. We investigate when a firm should disclose quality and the interaction between consumers' strategic behavior and the firm's disclosure behavior. We obtain several findings. First, regardless of whether consumers have low or high patience, the firm should disclose quality information if product quality is high and conceal it if product quality is low. However, for products with moderate quality levels, the firm will disclose more quality information to consumers with relatively high or low patience levels than when consumer patience is moderate. Second, firms will disclose less information when consumers behave strategically than when they are myopic. Third, when concealing quality information is an equilibrium, product prices are affected only by disclosure costs and independent of true product quality. Finally, the firm can benefit from consumers' strategic behavior and a higher disclosure cost, but greater patience might be detrimental to consumer surplus and social welfare.     

Why World Oil Monopolization Lowers Oil Prices: A Theory of Involuntary Cartelization

This paper first shows that, in the absence of long-term production commitments, time-consistent monopolistic sellers of a wasting natural resource will underconserve their resource. Since the present values of the profits of these uncommitted monopolists are generally much lower than under competition, the only rational explanation for the persistent recurrence of such monopolies in the oil industry is the high profits to current generations of oil buyers, who unite to establish such a producer monopoly. The victims of such a monopolistic cartel, besides future generations of consumers, are the producers who must involuntarily expand their current productive capacities in order to benefit the cartel leaders, who stand to benefit from the higher future prices. OPEC, rather than being a monopolistic cartel, is an excess-capacity cartel, one that has been induced by current generations of buyers to supply sufficient excess capacity to efficiently accommodate their prospective future emergencies.     

Monopoly, Time Consistency, and Dynamic Demands

This paper examines monopolistic behavior in a framework with dynamic demands. We show that time consistent output and pricing policies yield different equilibrium outcomes in terms of profits and welfare. In a simple two-period model, we find that pricing policies impose less restrictive constraints on a producer of addictive goods, allowing him to attain higher equilibrium profits. In contrast, a durable goods producer is better off implementing output policies. We study the effect of instrument selection on the strategic properties of the monopolist’s intra- personal game. Intertemporal substitutabilities imply that current and future prices are strategic complements, while current and future output levels may be strategic substitutes. Intertemporal complementarities reverse the strategic properties of these instruments.     

Recycling as a marketing problem: A framework for strategy development

This article provides a framework for integrating past recycling research by conceptualizing recycling compliance as a marketing problem. Within a social marketing framework, recycling behavior is considered the product, and the marketing problem is to sell recycling to the consumers or public. Recycling research is then categorized as consumer research (research on characteristics of the recycler), pricing research (research on the costs to the consumer, including implicit or less tangible costs), distribution research (research on modes of participation for the recycler), and promotional research (research on intervention strategies such as raffles and contests, personal selling techniques such as block leader programs, and persuasive communications). Using this framework, we provide an integration of a vast amount of recycling research, and also suggest how this research can be used to design actionable strategies for the development of community recycling programs. © 1994 John Wiley & Sons, Inc.     

Determining profitable products in the retail market with consideration of cash limitation and exhibition periods

In the selection of profitable products, consumer preferences and retailer constraints in products supply must be considered. When data mining algorithms are used to discover the consumer's preferences from transaction database, the results may be biased, if the exhibition period of the products has not be considered. In this study a new method is proposed to adjust the support and confidence coefficients of traditional association rule mining algorithms such as Apriori or FP-growth taking into consideration of common exhibition periods. On the supply side, the retailer may have some limitations in terms of buying and supplying products in the store. In the most recent researches, only the shelf space constraint has been considered. In this study, financing as an important constraint in the retail market and the opportunity cost of money are imported in the selection of profitable products.The researcher's experiment on real world data shows that the number of frequent itemsets increases significantly when products exhibition periods are taken into consideration. In this case, if the retailer considers the opportunity cost of money as 1%, the profitable set composition will be changed by 10%. Also, when the opportunity cost is 1% and the retailer faces cash limitation, the number of products is reduced by 21% in the most profitable set, whereas the new set composition is 29.4% different from the base set.     

中国制造业的市场集中、地理集聚与企业绩效

本文研究我国制造业的市场结构与地理分布对企业全要素生产率的影响.以中国工业企业数据库的大样本数据为基础,采用LP法计算企业生产率,构造市场集中度指标和地方化经济、城市化经济两个集聚指标,进行了多方位的计量检验.研究结果表明,制造业的市场集中不利于企业生产率的提高,代表专业化水平的地方化经济促进了企业生产率的提升,度量行业间多样化集聚的城市化经济对企业生产率没有显著的影响.市场集中对出口企业的负面影响不明显,控制市场集中和地理集聚后,出口企业生产率高于非出口企业,出口的“生产率悖论”并不存在.     

Brakes to organic market enlargement in Spain: consumers’ and retailers’ attitudes and willingness to pay

In Spain, consumption of organic products has not kept pace with production. Up till now, foreign markets have been a natural destination for excess supply. However, world trade liberalization might cause important commercial problems to Spanish producers that could be partially solved by enlarging the domestic market. The goal of this paper is to assess the opportunity for such enlargement focusing on two main aspects: consumers’ and retailers’ attitudes and willingness to pay for organic products. Concerns about health, natural diets or environmental issues could stimulate consumption, while retailing dynamism and competition to gain new market segments might favour distribution. Both aspects are investigated through two surveys addressed to consumers and retailers in two Spanish towns. The results confirm that only a small proportion of consumers and distributors show attitudes that might favour demand expansion. The most sensitized segments are willing to pay more for organic products, but this premium is still very far from the prevailing gap between conventional and organic food products.     

Decreasing Marginal Impatience and Capital Accumulation in a Two‐Country World Economy

This research is the first to examine dynamic general equilibrium in a growing two‐country economy under decreasing marginal impatience (DMI). The stability condition is shown to be more restrictive than in the case of an endowment economy and/or under increasing marginal impatience (IMI). By analyzing global‐economy adjustment to time preference shocks, international transfers and productivity shocks, equilibrium dynamics in the presence of DMI differ drastically from what is obtained when the standard IMI model is used. For example, in a country characterized by DMI, a positive productivity shock improves the country's welfare level and lowers its steady‐state time preference and, hence, the steady‐state interest rate. This leads to an increase in the neighbouring country's capital stock.     

中国产品质量缺陷形成的政治经济学分析

两个经济原因导致中国市场产品质量缺陷充斥：一是收入分配不公平和经济发展水平,它们从需求方面通过市场机制引导厂商向市场供给问题产品;二是信息不对称而政府监管缺位,导致本可避免的产品质量缺陷存在。经济发展水平导致的质量缺陷短期内基本上是难以解决的,收入分配不公平则需要通过政治途径解决,信息不对称引起的市场在产品质量上的失败应该是由政府来解决的,但是它们都因为政治性因素的影响而未能解决。     

Consumer Education As A Means of Alleviating Dissatisfaction

In this paper the traditional approaches to Consumer Education are analyzed with respect to their possible impact on the currently wide-spread dissatisfaction among consumers. The argument is raised that the dissemination of knowledge of good buymanship alone cannot change the prevailing dissatisfaction because of the inevitable collective interdependency of consumers' fate in the marketplace and the economic benefits they can derive from their alternative role as producers, employees and wage earners. On the other hand, it is shown that greater improvements could be obtained if some of the knowledge available from studies of job satisfaction could be applied to man's satisfaction in the consumer role. Such an endeavor would enlarge the present scope of consumer education from its sole concern with competitive economics into that of interpersonal relationships and other behavioral aspects of man's life as consumer.