The Effects of Consumer Education on Consumer Search

This paper reports the results of an empirical investigation of the relationship between selected consumer and marketplace characteristics—focusing on participation in consumer education activities—and consumers’ prepurchase information search behavior. A need exists for further study of the counteractive effects that consumer education is likely to have with respect to preferences for search and to the efficiency with which consumers conduct search.     

Windfall Income and the Permanent Income Hypothesis: New Evidence

This paper examines consumer response to windfall income. By using data from the 1972–73 Consumer Expenditure Surveys, an attempt was made to test Friedman's permanent income hypothesis. The results revealed that the marginal propensity to consume regular income was greater than the marginal propensity to consume windfall income for windfalls that were large relative to regular income. However, when windfall income was less than ten percent of regular income, the relationship reversed. Implications are drawn for short and long-run fiscal policies affecting consumers     

Aggregate Market Reaction to Earnings Announcements

This analysis identifies a distinct immediate announcement period negative relation between earnings announcement surprises and aggregate market returns. Such a relation implies that market participants use earnings information in forming expectations about expected aggregate discount rates and, specifically, that good earnings news is associated with a positive shock to required returns. Consistent with this interpretation we find that Treasury bond rates and implied future inflation expectations respond directly to earnings news. We also find some evidence that the negative relation between earnings news and market return persists beyond the immediate announcement period, suggesting that market participants do not immediately fully impound these future market return implications of aggregate earnings news.     

Dynamics of Complaint Management in the Service Organization

While the consumer affairs and services marketing literatures recognize the importance of input from customers, little is known about how customer feedback systems might operate, particularly in dealing with customer complaints. This paper offers an information processing model of the complaint information flow within the organization and poses hypotheses based on the suggested model. A new field study technique using a type of network analysis is used to empirically test hypotheses and discover barriers and facilitators to the flow of communications. The study provides insight concerning how complaint information flows through the organization after it has been received by a customer contact employee. The results provide support for the thesis that the role of complaint handler and manager in providing the service is at least as important as the role of the customer contact employee.     

The Cost of Driving a Car Off the Dealer's Lot

This paper examines the loss of value incurred when a consumer takes retail delivery of a car. Statistical tests of percentage and absolute losses from taking retail delivery show the loss of value is not unique to new cars and is actually more pronounced for older used cars. analysis of this loss shows the effect is not as great as is commonly believed and is more due to transaction costs of the deal than to any underlying loss of asset value of the car. The implication is that consumers wishing to avoid a large percentage loss of value on a transaction cannot easily do so by avoiding the new car market.     

Cross-National Comparison of Consumer Attitudes Toward Consumerism in Four Developing Countries

This paper analyzes the results of an empirical investigation on attitudes toward consumerism in four developing countries. Comparisons of these consumerism views are made along three different dimensions. Findings provide some support for the “consumerism life cycle pattern.” Alternative reasons for the results are discussed, and directions for research are examined.     

Payments Settlement: Tiering in Private and Public Systems

What are the benefits provided by a payment system? What are the trade‐offs in public versus private payment systems and in restricted versus open payments arrangements? Modern payment systems encompass a variety of institutional designs with varying degrees of counterparty protection. We develop a framework that allows for an examination and comparison of payment systems, and specification of conditions leading to their adoption. We relate these conditions to the design of present large‐value payment systems (Fedwire, CHIPS, TARGET, etc.).     

Diversification and top management team complementarity: is performance improved by merging similar or dissimilar teams?

This study examines the impact of complementary top management teams (defined as differences in functional backgrounds between the acquiring and acquired firm managers) on post-acquisition performance. Based on a sample of 147 acquisitions completed during 1986–88, we find that complementary backgrounds have a positive impact on postacquisition performance in both related and unrelated acquisitions. Another major finding is that complementarity is negatively related to top management team turnover among acquired managers, suggesting that differences in functional backgrounds are more easily integrated into the new organization. Finally, top management team turnover among acquired managers is negatively related to postacquisition performance. These findings highlight the importance of examining complementarity in terms of differences, and reinforce the notion that differences have the potential to create unique value for the organization. © 1997 by John Wiley & Sons, Ltd.     

TOWARD BEHAVIORAL MODELING OF ALASKA GROUNDFISH FISHERIES: A DISCRETE CHOICE APPROACH TO BERING SEA/ALEUTIAN ISLANDS TRAWL FISHERIES

This article implements a discrete choice model of fishery participation in the multispecies trawl fisheries of the Bering Sea/Aleutian Islands Region off Alaska. Nonparametric estimates of the operation-specific moments of quasirent by fishery and week are used to explain probabilities of choosing different target fisheries. There are pronounced risk aversion, seasonal, and relative performance effects. Notably, the model runs with regularly collected data, so this type of discrete choice modeling can be used routinely in the management and policy evaluation process. Improvements are needed, though, in both the quality and the extent of economic data on fisheries in Alaska and elsewhere in the United States. (JEL Q22, C25, Q28)     

Ideas, Civil Servants and Keynes

Sir John Hoskyns has joined Anthony Wedgwood Benn in condemning Civil Service obstruction to the implementation of government policy. William Kingston examines the changes in the Civil Service that have made bureaucratic stubbornness all too predictable.