The Effect of Scarcity on the Purchase Intentions of Prevention and Promotion Motivated Consumers

This study investigates the influence of consumers’ motivational orientations (“prevention” vs. “promotion”) on their susceptibility to demand‐based versus supply‐based scarcity, measured by purchase intention scores. Prevention‐focused participants were more inclined to adopt a product when it was perceived to be demand‐scarce rather than supply‐scarce, while those who were identified as promotion‐focused responded positively to scarcity attributed to supply shortfall. In addition, products that could be associated with a prevention motive enhanced purchase intentions when presented as demand‐scarce but not if perceived to be supply‐scarce; conversely, products associated with the promotion motive scored better if the scarcity was seen to be supply‐generated rather than demand‐generated. Lastly, messages focused on prevention were more effective than those focused on promotion in the case of perceived demand scarcity, whereas the converse holds true for supply scarcity. These findings highlight the importance of understanding the motivational differences underlying the effectiveness of scarcity appeals. They furthermore suggest the strategic implication that improved intention to purchase occurs when the regulatory focus evoked by a scarcity‐related message is compatible with the appeal it communicates.     

Should Prices of Consumer Goods Be Better Indicators of Product Quality?

In contrast to the common assumption that prices are good indicators of quality, this note argues that price-quality correlations are typically rather low. Such low coefficients are not surprising since mass-produced goods of high quality may have lower prices than scarce goods of lower quality. In addition, low correlations can be characterized as desirable, since prices are an indicator not of quality but of scarcity.     

Declining Protection in Developing Countries: Fact or Fiction?

This paper explores whether and to what extent evident trade reform, falling average tariffs and rising exports in recent decades overstate the extent to which protectionism has declined in developing countries, especially low‐income developing countries. It identifies remaining significant protection, especially of final manufactured goods; this being associated with the presence of peak tariffs, escalating tariff structures by stage of production and replacement of old forms of non‐tariff protection with new instruments of non‐tariff protection. It also identifies significant protection arising from high international trade costs induced by inefficiencies in transportation, ports and customs, and from the growth of exports to preference‐receiving, export markets.     

Food waste paradox: antecedents of food disposal in low income households

This article aims to identify antecedents of food waste among lower‐middle class families – a paradox, given the financial constraints this population faces. The importance of this research is evident in escalating environmental pressures for better use of our planet's scarce resources. Given that most of the world is low‐income, any behavioral change in this population is likely to have a considerable impact. Empirical data were collected from 14 lower‐middle income Brazilian households, based on observations, in‐depth interviews, photographs and a focus group (n = 6). Five major categories of food waste antecedents were identified: (1) excessive purchasing, (2) over‐preparation, (3) caring for a pet, (4) avoidance of leftovers and (5) inappropriate food conservation. Several subcategories were also found, including impulse buying, lack of planning and preference for large packages. Surprisingly, findings show that strategies used to save money – such as buying groceries in bulk, monthly shopping trips, preference for supermarkets and cooking from scratch – actually end up generating more food waste. This mitigates the savings made during the purchasing phase.     

Unintentional drowning in urban South Africa: a retrospective investigation, 2001–2005

Drowning is a major public health concern in low- and middle-income countries. In South Africa there is sound information and an emerging knowledge base for drowning prevention. However, there remains a scarcity of analyses of drowning in the country. The purpose of this analysis was to quantify the magnitude and describe occurrence of unintentional drowning deaths in five major South African cities, recorded between 2001 and 2005 by the National Injury Mortality Surveillance System. Drowning in South African cities occurred at rates of between 1.4 and 2.7/100,000 population. The majority of drowning occurred among males, while the highest rates were observed among 0–4 year olds. Most drowning deaths occurred during recreational periods, over weekends and in the afternoon. Of adult drowning victims, 41.5% were alcohol-positive at the time of death. This study is based on one of only two known systematic sources of drowning mortality in Africa. It provides an indication of drowning rates in South African cities with young children and males at considerably more risk. The most likely locations for drowning varied from city to city. Among adult victims, especially men, alcohol is an important risk factor.     

Market entry into new export markets: When are firms more likely to imitate their competitors’ market presence?

We investigate the extent to which competitors’ presence in a given export market has an impact on a firm's decision to enter such a market and, more precisely, under what conditions imitation is more likely to take place. We show that firms with greater export knowledge are more likely to enter those countries where their competitors are already present. Furthermore, experiential knowledge seems necessary to absorb valuable information provided by the presence of competitors in those markets. Thus, imitation should not be regarded as the option best suited for firms with reduced expertize that follow blindly their competitors into new markets. Through a panel analysis of Brazilian exporters during the 2001–11 period, our study contributes to research on market entry decisions, especially stressing the critical role of prior relevant knowledge in facilitating imitation among players.     

Exchange Rate Pass-Through and the Role of Market Shares

This paper examines the effects of changing market shares on exchange rate pass-through to US import prices. Based on a static model of imperfect competition, I predict that a country with a larger share of a host’s import market will have lower pass-through than its competitors. Using highly disaggregated data on US imports, I implement rolling regressions to calculate unique quarterly values of pass-through for specific goods from each exporting country. These values are compared across market shares, indicating a general trend of decreasing pass-through for larger shares. Most specifically, as predicted by the model, the country holding the largest share of the market has significantly lower pass-through than its competitors. The negative relationship between pass-through and market share holds across most categories of goods, most notably the larger categories of imports. Lastly, I show the market share effect is stronger following larger fluctuations in the exchange rate, particularly after large dollar appreciations.     

The NAFTA Preference and US‐Mexico Trade: Aggregate‐Level Analysis

This paper focuses on the US tariff preference afforded to Mexico relative to non‐NAFTA trading partners and evaluates the trade effects of NAFTA in a manner consistent with the idea behind a preferential trading agreement. The estimation technique exploits the time‐varying dimension of the tariff preference over 1989 to 2001. This is important because the tariff preference for Mexico into the United States market existed prior to NAFTA. Further, the NAFTA preference was phased in over time. We find that a higher US tariff preference for Mexico corresponds to increased US import demand for Mexican goods, and that a higher Mexican tariff preference for the United States corresponds to increased Mexican demand for US exports. Interestingly, import demand was more responsive to changes in the tariff preference once NAFTA was in place than it was on average.     

The behavioral responses to perceived scarcity – the case of fast fashion

The literature on scarcity has generally examined consumers’ attitudes towards scarce products and suggested that scarcity messages have a positive effect on the evaluation of and attitude toward the scarce object. However, literature has largely failed to explain consumers’ feelings or reactions to human-controlled scarce environments. This study examines how deliberate product scarcity influences the consumers’ behavioral responses, and provides an understanding of consumers’ reactions to conditions of scarcity that are strategically created by marketers. The context of this study is fast fashion retailers, as they are known to create extreme human-induced scarcity. We conducted 21 face-to-face interviews with fast fashion store managers, consumers, and an industry expert. Further, observational research was also conducted to observe the consumer buying behavior across 10 different fast fashion stores. The objectives were to (1) help the interviewees think about the various strategies adopted to induce scarcity within the stores (from retailer’s perspective), (2) understanding of scarcity in these stores (from consumer’s perspective), and (3) consumers’ responses to such deliberate manipulations. All the interviewees agreed that fast fashion stores were successful in creating perceived scarcity which reflected both limited merchandise supply as well as deliberate manipulation of merchandise availability by the retailer. The findings also suggest that consumers in these perceived scarcity conditions exhibit buying behavior like urgency to buy, which further leads to deviant and competitive behaviors like in-store hoarding and in-store hiding. Though perceived scarcity, urgency to buy, and in-store hoarding was consistent across the interviews with store managers and consumers, surprisingly, the phenomenon of in-store hiding behavior did not emerge from any of the interviews conducted with store managers, but was a consistent theme across most consumer interviews.     

Complementary Goods: Prices and Consumer Welfare Under Duopoly and Monopoly

We examine prices, profits, and consumer surplus for differentiated complementary goods under duopoly and a multi‐product monopoly. We find that little can be said about the relative magnitudes of prices of the components of a system of complementary goods under the alternative market structures. Although demand complementarity can lead to lower prices for either the primary or the secondary good under monopoly, both prices are not necessarily lower. The results unique to this paper are that, when two complementary goods form a system, the system price is unambiguously lower and consumer surplus and profits are higher under a multi‐product monopoly.     

Educating young consumers – a food choice model

It has been acknowledged that it is only by obtaining a more detailed understanding of food choice that people’s diets can be improved. In Northern Ireland, research into food choice has been limited yet the Province has the second highest rate of heart disease in the world, indicating the need for change. This study investigated the food choices of 9‐ to 17‐year‐olds in Northern Ireland and the influential factors. A range of research techniques were employed incorporating both qualitative and quantitative methods, namely observations, focus groups, picture associations, dietary case studies and questionnaires. The research indicated that the dietary patterns adopted by this group are characterized by a high consumption of fat, yet the reduction of fat tends to dominate the overall strategy for the prevention of obesity and lowering the risk of coronary heart disease. In addition, a high consumption of sugar products was evidenced along with a distinct dislike for healthier alternatives such as fruit and vegetables. The ‘skipping’ of meals, especially breakfast and a high prevalence of snacking was also apparent. However, these eating habits were found to be affected by various factors such as age and gender, emphasizing the complex nature of food choice. The findings from this research enabled the development of a model relating to the food choices of 9‐ to 17‐year‐olds in Northern Ireland, highlighting the influential factors and subsequent health implications.     

Scarcity effects on sales volume in retail

Prior research provides controversial findings as to whether products become more or less desirable when accompanied by product scarcity. As there are many options relevant for retailing to generate product scarcity, it seems beneficial to identify the conditions under which scarcity should be applied as an instrument for sales promotion. We differentiate our considerations by the type of scarcity, the product category and by the existence of other purchase arguments for the scarce product. The main result of our empirical investigations is that these three conditions are relevant factors which influence the direction of scarcity's effect on product desirability.     

Wage and Price Dynamics in China

We study wage‐price dynamics in Mainland China with a novel data set using province‐level data from 1994 to 2010. We find that the growth in labour costs in China is not passed through fully to final prices, neither in the tradable goods sector nor in the economy as a whole. This probably reflects the strong pressure on profit margins from a highly competitive environment, especially in manufactured goods. These findings have potential implications for global price developments, given China's relevance in global supply chains.     

International trade in services: A portrait of importers and exporters

We provide a novel set of stylized facts on firms engaging in international trade in services, using unique data on firm-level exports and imports from the world's second largest services exporter, the United Kingdom (UK). We show that only a fraction of UK firms engage in international trade in services, that trade participation varies widely across industries and that service traders are different from non-traders in terms of size, productivity and other firm characteristics. We also provide detailed evidence on the trading patterns of service exporters and importers, such as the number of markets served, the value of exports and imports per market and the share of individual markets in overall sales. We interpret these facts in the light of existing theories of international trade in services and goods. Our results demonstrate that firm-level heterogeneity is a key feature of services trade. Also, we find many similarities between services and goods trade at the firm level and conclude that existing heterogeneous firm models for goods trade will be a good starting point for explaining trade in services as well.     

The Impact of Power Distance Belief on Consumers' Brand Preferences

Five lab studies and a field study explore how power distance belief (PDB) influences consumers' preference for mass-market versus niche brands, the underlying mechanisms, and boundary conditions. We find that high (vs. low) PDB consumers are more likely to prefer mass-market over niche brands because they tend to be risk averse, which in turn increases preference for widely used brands. Consequently, the relationship between PDB and brand preferences is mediated by risk aversion. Further, when product usage contexts are risky, low (but not high) PDB consumers' preference for mass-market brands increases, whereas offering an extended money-back guarantee increases high (but not low) PDB consumers' preference for niche brands. In addition, we find that when choosing service providers (versus choosing physical goods), low (but not high) PDB consumers are significantly more likely to prefer mass-market brands over niche brands. We conclude with the implications of these findings for marketers, such as for their segmentation and targeting endeavors. We also provide specific tools that marketers could use, both inside and outside the store, to influence consumers' preference for mass-market versus niche brands.     

Children's understanding of television advertising: a qualitative approach

In this paper children's understanding of television advertising was explored using focus groups in a qualitative approach. None of the 6 year olds, a minority of the 8 year olds and by no means all of the 10 year olds were able to articulate an understanding of the persuasive nature of advertising. It was concluded that children's understanding of the persuasive intent of television advertising is less well developed than previously thought, challenging current marketing perspectives. These findings raise questions for European legislation, UK broadcasting practices and for advertisers and manufacturers who target children.     

The Determinants of GATS Commitment Coverage

This paper investigates hypotheses about the determinants of trade and investment liberalisation with a particular focus on the market access and national treatment commitments under the General Agreement on Trade in Services (GATS). We set up a database of these GATS commitments and use the ratio of all commitments listed by a country to the possible number of commitments as a measure of liberalisation of market access/national treatment. Our empirical analysis suggests that larger and ‘richer’ countries commit to more liberal regimes of market access and national treatment. This is surprising since economic theory predicts the largest welfare gains for low‐skilled abundant (skilled‐labour/physical‐capital‐scarce) economies. Also, our findings suggest that liberalisation is stronger among geographically close countries with strong ties in goods trade.     

Ageing and consumption in Finland: The effect of age and life course stage on ecological,economical and self‐indulgent consumption among late middle‐agers and young adults between 1999 and 2014

Previous studies on ageing consumers have mainly focused on chronological age and generational values or studied ageing and consumption with cross‐sectional data. Few quantitative studies exist that examine the effect of age together with life course on consumption using longitudinal data. To bridge this gap, the article examines ageing and attitudes towards consumption in Finland, focusing particularly on late middle‐agers (46–60 year‐olds) in comparison with young adults (18–30 year‐olds) between 1999 and 2014. The article explores three consumption patterns based on attitudinal statements: ecological, economical and self‐indulgent consumption. Through analysis of a nationally representative survey study in Finland (N = 8,543), the article reveals that in all years under examination, late middle‐agers reported more ecological attitudes towards consumption than young adults. In 1999 and 2004, the attitudes of late middle‐agers appeared more economical, but age‐related differences in economical attitudes disappeared between 2009 and 2014. In each year, late middle‐agers reported less self‐indulgent attitudes than young adults, and these age‐related differences did not remarkably change between 1999 and 2014. The results indicate that in 1999 and 2004, ecological and economical attitudes towards consumption were best predicted by age at the year of the study. In later years, ecological attitudes were more closely determined by life course stage, that is household type and other socio‐demographic determinants. Regarding economical attitudes, generational or cohort effects were pronounced among late middle‐agers in 1999. In contrast, the significance of age remained throughout the years for self‐indulgent attitudes, indicating the absence of generational or cohort effects.     

A Natural Resource Scarcity Typology: Theoretical Foundations and Strategic Implications for Supply Chain Management

World population growth and increased consumption stemming from economic leveling are leading to scarcity of a number of natural resources on a global scale. Scarcity of critical natural resources such as oil, water, food, and precious metals has the potential to greatly impact commercial activity as the twenty‐first century progresses. The challenge of continuing to provide needed goods and services in the face of these constraints falls to supply chain managers, who are ultimately responsible for delivering utility to customers. Unfortunately, there has been almost no research focused on supply chain strategies aimed at mitigating natural resource scarcity’s (NRS) potential effects. The current research positions NRS as a supply chain risk and proposes an NRS typology based on key resource attributes. Supply chain mitigation strategies to counter each resource status are offered, with an overall objective of improving supply chain performance. The study recommends future research aimed at further developing theory and methods for countering NRS based on resource, systems and behavioral theories. In addition, this study has critical implications for practitioners faced with the growing threat of NRS in their supply chains.     

Food Miles: Starving the Poor?

Food miles measure the distance food travels to reach consumers’ plates. Although substituting local food for imported produce will not necessarily reduce greenhouse gas (GHG) emissions, the food miles movement is widely supported by consumers and import‐competing producers, especially in some parts of Western Europe. We investigate the economic implications of food miles preference changes in the UK, France and Germany on other nations using an economy‐wide model. Among the regions we consider, New Zealand is the most distant from Western Europe and Madagascar and Malawi export the most agro‐food products relative to GDP, so food miles movements have the largest impacts on these regions. When there is a linear relationship between distance and preference changes, food miles campaigns decrease welfare in New Zealand, Madagascar and Malawi by 0.30, 0.12 and 0.28 per cent, respectively. When there is a preference shift away from imported food unrelated to distance, proportional welfare losses in the three countries are, respectively, 0.11, 0.08 and 0.24 per cent. With the exception of New Zealand, these findings indicate that some of the world’s poorest nations will suffer the most from European food miles lobbying. We conclude that food miles campaigns will increase global inequality without necessarily improving environmental outcomes.