The Cinderella moment: Exploring consumers' motivations to engage with renting as collaborative luxury consumption mode

Past literature argued that the purchase of luxury goods is driven by people's motivation to conform or fit into our economic and social system. In this study, the authors focus on a new aspect of consumption, that is, renting instead of purchasing luxury goods, backed by the emerging opportunities of sharing economy platforms. Drawing upon the analysis of spontaneous consumers' online communications (in the form of tweets), this study aims to investigate the motivations to engage with luxury garment renting within a collaborative consumption context. To this end, a series of automatic content analyses, via two studies, were conducted using the tweets posted with respect to the Run the Runway collaborative consumption platform. Results demonstrate consumers' increased willingness to show their social status through renting rather than owning luxurious apparel based on five main motivators (need to wear new clothes for a special event, inspirations created by the products/brands, possibility to explore a new way of consuming luxury goods, need to make more sustainable choices, and to increase the life cycle of each luxury product). The implications of these findings are discussed, while they pave the way for future research in collaborative consumption of luxury retailing.     

INTERNATIONAL TRADE COMPOSITION AND MEDIUM-RUN GROWTH: Evidence of a Causal Relationship

The motivation for this article stems from Mazumdar's (1996) hypothesis that international trade composition impacts a country's ability to achieve transitional economic growth. In his article, Mazumdar suggested that developing economies, generally known for exporting consumption goods and importing capital goods, benefit more from international trade than do developed economies. In addition to static gains, developing economies experience a decline in the replacement costs of capital as the relative price of capital falls with trade. To empirically test this hypothesis, a trade composition variable is created using unpublished SITC export and import data of both consumption and capital goods. Incorporating this variable into a linear equation, a Granger Causality test and a more extensive VAR test are performed for a select group of developed and developing economies. The empirical results are suggestive, and indicate some support for the hypothesis that trade composition "causes" medium-run transition.     

Family Composition,Parental Time,and Market Goods: Life Cycle Trade-Offs

The present study supplements Canadian consumer expenditure survey data with unique time use data to analyze family life cycle decisions regarding allocation of full income to market purchased consumption goods, home production, and leisure time. Results confirm that young children's presence causes families to increase their shares of full income allocated to home production and to decrease the shares of full income allocated to leisure. As a share of full income, expenditures for market goods steadily increase while expenditures for women's home production diminish as children age.     

Do‐It‐Yourself Projects as Path toward Female Empowerment in a Gendered Market Place

The role of women as homeowners and heads of households are changing the dynamics in which women engage in do‐it‐yourself (DIY) behavior. Because there is limited extant theory associated with female involvement in DIY behavior, a qualitative study using in‐depth interviews was conducted. Through grounded theory analysis several themes emerged during the coding process, and the themes of empowerment were especially relevant to the informants in this study. Five dimensions of empowerment were identified: empowerment through project initiation, production mastery, adding economic value to goods and services, unleashing creative potential, and empowerment through ownership. The findings show women's involvement in DIY behavior and the consumption of DIY‐related goods is closely tied to the concept of female empowerment.     

Production of (Pleasant) Time by Means of (Unpleasant) Time: Some Notes on Consumption Theory and Time Use

The aim of this paper is to propose an analytical framework wherein the individuals' choice problem is addressed in terms of alternative time‐consuming activities rather than alternative bundles of goods and services. In particular, the paper reverses Becker's (1965, The Economic Journal, 75 (299), pp. 493–517) proposal to approach the problem of time allocation by transforming the time spent in consumption into foregone earnings. The result of reversing Becker's approach is a model that represents each activity as a sort of productive process allowing pleasant time to be produced by consuming ‘direct’ unpleasant time plus the ‘indirect’ amount of unpleasant time equivalent to the market goods used up as inputs.     

Movies and the Mystery of the Missing Trade: Is Hollywood Good for U.S. Exporters?

Research has shown that consumers have a preference for goods based on the origin of production. This is important because it suggests that, in some cases, even lowering trade barriers may not significantly increase trade flows. In particular, flows may be lower than are predicted by trade theories such as Heckscher-Ohlin. Despite evidence that home consumption bias exists in many countries, it is only recently that research has begun to examine the sources of this bias.

This article fills a gap in the literature by testing a model that addresses the source of this consumption bias. The paper's model incorporates consumers' exposure to foreign products and culture through media imports and tourist visits as factors affecting consumers' preferences for foreign products. Using panel data from 19 countries, the article's results support the hypothesis that lagged exports of U.S. movies have a positive impact on other U.S. exports. Some evidence is also found of a positive effect of tourist visits on U.S. exports.

Since U.S. media exports may generate demand for other U.S. goods and services, opening up foreign media markets should receive a higher priority in U.S. trade negotiations. Another interesting implication of the paper is that overall U.S. export losses resulting from media piracy may be lower than previously calculated, as the consumption of pirated media products may increase demand for other U.S. exports.     

The environmental burden imposed by the family's activities

Calculations of the environmental burden from a model family's consumption show that family activities associated with eating make up more than one-third of the family's total consumption of resources and discharges to the surroundings. Car transport and residential heating together also account for one-third of the family's resource consumption and discharges to the surroundings. The remaining third of resource consumption and discharges to the environment relates especially to the consumption of goods during leisure activities around the home, clothing, hygiene and health as well as cleaning.     

Anthropomorphizing makes material goods as happiness-inducing as experiences

Prior research suggests that material goods (e.g., electronic gadgets) often provide less happiness than do experiences (e.g., movies). As a boundary condition, the present research proposes a theory-based yet actionable solution to overcome the happiness disadvantage of material goods. Three studies show that when material goods are anthropomorphized (i.e., imbued with humanlike characteristics), consumers gain enhanced feelings of consumption sociality and, in turn, derive a boost in happiness such that they gain as much happiness from these material goods as from experiences. With mediation and moderation approaches, we provide process evidence for these enhanced feelings of consumption sociality that are typically lacking with material purchases, which are prone to being consumed alone rather than with other people. Thus, the present research suggests that even in the absence of other people, consumers can gain greater happiness from their material goods by perceiving them as human.

     

Why buy new when one can share? Exploring collaborative consumption motivations for consumer goods

The notion of collaborative consumption or sharing economy—where consumers share access to ownership of properties such as cars, clothes and accommodations—has gained tremendous popularity in recent years. Development of communication technologies and peer‐to‐peer communities has enabled consumers to coordinate sharing activities through various online platforms. Collaborative consumption involves sharing of both intangible (e.g., music, space and car rides) and tangible assets (e.g., household items, clothes and furniture). Activities such as renting, swapping, trading and purchasing/selling used consumer goods are included in the latter. Despite increasing academic attention on collaborative consumption, little research has been pursued in the context of consumer goods. The nature of consumption for tangible goods can be entirely different from that of intangible goods because people can exercise greater control over tangible goods, which results in greater psychological ownership than that for intangible goods. To address this gap, the objective of this study is to develop a scale that examines consumer motivations for collaborative consumption of consumer goods. Following Churchill's paradigm of scale development, the procedures of scale item generation, purification and validation were conducted via in‐depth interviews, literature review and surveys. The study identified five underlying dimensions of collaborative consumption of consumer goods: concern‐for‐sustainability, social, variety‐seeking, fun and cost‐saving. Study findings and implications are discussed, and future research avenues are suggested.     

An Extension of Ausubel's Auction for Heterogeneous Discrete Goods

Ausubel's dynamic private‐values auction for heterogeneous discrete goods, Ausubel (2006), yields an efficient equilibrium outcome but it is designed for a limited class of environments. If bidders’ values for bundles of goods are not integers, then Ausubel's auction may end without allocating goods if no information on bidders’ values is available. In this paper, I extend Ausubel's auction for heterogeneous discrete goods to real‐valued quasilinear utility functions. The mechanism I propose reaches a Walrasian equilibrium price vector in finite ‘steps’ without any additional information on bidders’ values. In the extension of Ausubel's auction, truthful bidding constitutes an efficient equilibrium.     

Prepayment and future cross-buying: an exploratory analysis

Recent research has provided important insights on consumers’ preferences for prepayment mechanisms and on its impact on consumption of a given product or service. However, little is known about how prepayment influences future purchases of goods and services. We consider this question in a contractual setting within the services industry, involving different purchasing decisions over time. Based on a large-scale empirical test, we find that prepay customers make fewer changes to their cross-buying levels (i.e., the number of different services they buy from the company) from one contractual period to another, and that this effect is more salient for the firm's new customers. We propose possible explanatory mechanisms for this effect. For instance, based on mental budgeting theory, we suggest that prepayment customers may set mental budgets and track expenditures against this budget leading them to resist further investments. Alternatively, prepayment customers may be more certain about their consumption behavior leading to fewer changes over time.

     

Exchange Rate Volatility and Intra‐Asia Trade: Evidence by Type of Goods

This paper examines the impact of intra‐Asia exchange rate volatility on intra‐Asia trade in primary goods, intermediate goods, equipment goods and consumption goods from 1980 to 2009. For Asia, the evidence shows that as intraregional exchange rate volatility increases, intraregional exports in these goods fall. This adverse impact is even more pronounced in the subregion of Association of Southeast Asian Nations (ASEAN)+5 comprising ASEAN member countries plus the People's Republic of China; Hong Kong, China; Japan; the Republic of Korea; and Taipei, China; and especially among intermediate and equipment exports. Again, the impact magnifies in an even smaller subgroup excluding the smaller ASEAN economies. These results underline the significant impact of exchange rate volatility on the region's production networks. For South Asia, however, exchange rate volatility appears to have a positive impact on exports. Still, caution is warranted given that South Asian economies trade relatively little with each other.     

Durable Goods Monopoly,Buyer Uncertainty,and Concurrent Selling and Renting

Stylized durable goods monopoly models typically conclude that monopolists prefer to rent their output due to commitment problems associated with sales. However, we commonly observe monopolistic firms in durable goods industries simultaneously selling and renting output. To address this apparent discrepancy a simple two‐period asymmetric information model is constructed where buyers are uncertain of the good's durability and the firm's manufacturing costs. This is a natural asymmetric information specification since the firm typically has more precise knowledge of product durability and production costs than buyers do. The analysis indicates that a monopolist may wish to concurrently sell and rent output when buyers do not have perfect knowledge. If, for example, consumers believe that product durability and manufacturing costs are higher than they truly are, the firm may wish to simultaneously sell and rent output. Thus buyers' expectations about firm costs and product durability are of critical importance in durable goods models, particularly in terms of explaining concurrent rentals and sales.     

Online luxury goods with price discount or onsite luxury goods with luxury services: Role of situation-specific thinking styles and socio-demographics

Today, the luxury goods and service market is growing faster than ever. However, despite its growth, we do not know much about the ways in which consumers choose to shop online or in store when buying luxury goods. We also lack insight into the factors that can affect such luxury consumption decisions. The purpose of this study is to investigate whether consumers prefer to buy luxury goods online at a discounted price or would rather buy luxury goods in store with additional luxury services at a cover price. This study also examines the extent to which such decisions can be driven by their situation-specific thinking styles as well as other socio-demographic variables. The results show that participants adopted a rational thinking style when deciding to buy luxury goods online with price discounts. On the other hand, an experiential thinking style was evoked when participants chose to visit a store offering luxury brands and luxury services. In addition to momentary thinking orientations, gender as well as income were found to be relevant to a consumer's choice in a shopping platform when seeking luxury brands. More details about the study's findings and their implications are discussed below.     

Differentiation value through services in a manufacturer's delivery chain

The delivery of industrial goods includes various possibilities for service business. Previous research has concentrated on third-party logistics (3PL) providers' perspective on service opportunities. This study takes the manufacturer's perspective in inter-organizational relationships and investigates the potential for differentiation value though services associated with the delivery of industrial goods. Field observation was carried out on three high-volume construction component deliveries, to uncover differentiation value drivers and the emergence of service opportunities in a manufacturer's delivery chain. The results complement earlier 3PL-centered goods delivery research by showing that the manufacturer's unique product and process competences, and activities in the delivery chain drive differentiation value, enable new service opportunities. The findings, thereby, draw attention to manufacturers and their competences as sources of added-value service in the delivery of industrial goods. Manufacturing firms have various options for differentiation and centrality in the inter-organizational network through cooperation with third parties. The results reveal that third parties can be hidden sources of added customer value in the goods delivery chain. The differentiation value for different firms in the industrial goods' delivery chains can emerge when firms begin to develop and offer services to each other, and therefore a proactive and in-depth analysis of their customers' differentiation-oriented value hierarchies is required.     

The Influence of Children on Family Life Cycle Spending Behavior: Theory and Applications

This study examines the effect of children on family consumption decisions during different stages of the life cycle. An empirical model that incorporates both continuous measures of adult equivalence and a flexible functional form is used. Results indicate that durables, food eaten (purchased) away from home, and adult clothing are luxury goods for two-child families. Economies of scale are noted for food and shelter expenditures. Two-child families substitute out of expenditures for meals eaten away from home, adult clothing, and other goods and services to meet increased demand due to the children's presence.     

Are parents gender neutral when financing their children's consumption?

Children are consumers from early on, but they are dependent on financial support from their parents for many years. Based on a survey among 1173 Norwegian children aged 8–24 years, we examine how children's consumption is financed and how their main financial sources change during childhood, distinguishing between pocket money and odd jobs on the one hand and gainful employment and study loans on the other. Our analysis demonstrates how parental monetary support decreases as years go by and is replaced by gainful employment and study loans. We ask whether parents are gender neutral in supporting their children's consumption or not. This is done by comparing the distribution of pocket money among girls and boys, as well as the amount of money given to the respective genders for special consumer goods. Girls and boys have divergent preferences and often exhibit different spending patterns. The analysis of the six selected fields of consumption showed significant gender differences in four of them. By comparing what children choose to pay for with their own money with what they influence their parents to pay for, we find that parents' financial support tend to have a moderating effect on their children's own gender‐biased preferences.     

Tourism Promotion,Increasing Returns and Domestic Welfare

This paper compares the effect of tourism promotion funded by commodity tax and income tax on domestic welfare in an open economy with increasing returns in the tourism and the non‐tourism sector. A promotion may overcome the under‐production of tourism goods through taking account of the implications of increasing returns, but at the same time, the taxation may have an adverse impact on the rest of the economy. Employing a general equilibrium analysis, we find that the cost of tourism promotion overcomes the benefit, reducing local residents' welfare. Furthermore, commodity tax on tourism consumption is relatively more efficient than income tax in a monopolistic competition, with less adverse impact on the variety of non‐tourism goods. We also clarify the condition for deteriorating ‘terms of trade’, which only happens when the country has a small allocation of factor endowments.     

How the Fall of the Iron Curtain Has Affected Consumers' Perceptions of Urban and Rural Quality of Life in Romania

Summary

Marketing and quality of life (QOL) literature is reviewed to conceptualize a model of the impact of marketing activity on QOL. This model outlines how the four elements of the marketing mix affect the life domain of shopping, dealing with the acquisition, possession, use, and consumption of goods. In turn, four strategic considerations/indicators connecting this life domain with QOL are identified: the four A's linking marketing with QOL -i.e., appearance of goods in the market, and awareness, availability, and affordability of goods for consumers. A large-scale field study in urban and rural Romania, a country undergoing rapid marketization, was conducted to test hypotheses and to validate secondary data findings relating availability and affordability of goods with QOL for urban and rural consumers. The findings support the predictions that availability and affordability are positively related to QOL. Secondary data findings concerning changes in the availability and affordability of goods and services, and hypotheses concerning changes in the QOL in Romania between the years 1989 and 1993/1994 were also validated and supported. The findings indicate that availability has improved during this period, whereas afford-ability has decreased. Overall, as hypothesized, these changes have resulted in the deterioration of QOL in Romania in today's marketizing economy, as compared to the planned economy, before the revolution. Finally, urban versus rural differences in the impact of marketization in terms of changes in the availability and affordability and in QOL are also studied.