Valuing traceability of imported beef in Korea: an experimental auction approach*

The major objective of this study is to estimate Korean food shoppers’ willingness to pay (WTP) for imported beef with traceability. We use an experimental elicitation method, the random nth price auction, to identify consumers’ valuation for traceable imported beef. We also analyse the effect of different types of information on these valuations. Results indicate that consumers are generally willing to pay a 39 per cent premium for the traceable imported beef over similar beef without traceability. Results also suggest that in contrast to the insignificant effect of positive information, negative and two‐sided information about traceability significantly reduces WTP.     

Processing and Retrieval of Inferences and Descriptive Advertising Information: The Effects of Message Elaboration

Abstract

Two issues make advertising effectiveness difficult to assess: (1) advertising effects occur both during ad processing and when ad information is retrieved, and (2) the information that consumers derive from advertisements is likely to be some combination of explicit information and inferences. The study reported in this paper addresses these issues, examining the effects of encoding and time delay on advertising processing. Results indicate that while some types of inferences (product features) are more likely to be made under strong than weak encoding conditions, other types of inferences (consumption situation) are not affected by encoding. In addition, at the time of a decision (after a time delay), memory information use depends both upon individual brand accessibility and the relative accessibility of alternative brands in the memory set. Implications for both advertising researchers and managers are offered.     

Spectral Analysis of Advertising-Sales Interaction: An Illustration

Abstract

Cross-spectral analysis is recognized as a powerful analytical tool for the analysis of time-varying behavior in a number of disciplines. Applications in business have been limited, however, and the potential usefulness of this new approach to time series analysis has received relatively little attention in advertising. The purpose of this paper is to explain cross-spectral analysis and illustrate the use of this new technique in studying the interaction between advertising and sales.     

A Course in Economic Forecasting: Rationale and Content

This note shows that the impact of an increase in product price on factor demand in the typical textbook depiction is overstated to the point of indicating that competitive firms demand factors even when marginal product is negative.     

Risk and the Home Equity Conversion Mortgage

This article analyzes the risks involved with reverse mortgage insurance and explains the pricing model developed for the Home Equity Conversion Mortgage (HECM) demonstration. The paper demonstrates how borrower longevity, interest rates and property value changes all affect pricing, and why the HECM model focuses on property value as the primary source of uncertainty. It goes on to explain why a random walk specification was chosen to forecast property values, and how the principal limit factors, which determine cash payments to borrowers in the HECM program, are calculated.     

Leveling the playing field: factors influencing trade show success for small companies

Recent research indicates that trade shows are a place to find prospects and close sales. Yet, many requisites of success found in prior studies may not be available to companies with limited resources. A study that compares the activities of successful vs. unsuccessful exhibitors from small companies was conducted. Results indicate similar budgets, yet very different results. Factors influencing success include strategic factors such as centering responsibility in one position, as well as tactical decisions such as those regarding pre-show promotion.     

Revenue Sharing and Vertical Control in the Video Rental Industry

Revenue sharing contracts, in which retailers pay a royalty on sales to their suppliers, are now widely used in the video rental industry. We show that revenue sharing is valuable in vertically separated industries in which demand is either stochastic (unpredictable) or variable (e.g., systematically declining), downstream inventory is chosen before demand is realized and downstream firms engage in intrabrand competition. Unlike two-part tariffs, revenue sharing achieves the first best outcome by softening retail price competition without distorting retailers' inventory decisions. Our theories are also consistent with trends in prices and availability following retailers' adoption of revenue sharing contracts.