Business-to-Business Markets – Status Quo and Future Trends

As a phenomenon of modified value-chain structures the economic importance of business-to-business markets has been growing immensely during the past decades. This paper delivers a quantified overview of the market dimensions in terms of transactional volume. In addition, it explains the causes for this market development such as an increased service orientation in business transactions, higher degrees of customization, and influential factors on a macro level. In this context, future trends in this sector will be outlined as well.

The Role of Product‐Premium Fit in Determining the Effectiveness of Hedonic and Utilitarian Premiums

This research explores how the effectiveness of hedonic and utilitarian premiums is contingent with the degree of product‐premium fit. It is proposed that the effectiveness of utilitarian/hedonic premiums is higher at a high/low degree of fit between the premium and the focal product. Specifically, a series of three experimental studies were conducted. Consistent with expectations, Study 1 found that at high product‐premium fit utilitarian premiums were preferred over hedonic ones, while Study 2 revealed that hedonic ones were preferred at a low‐fit condition. To further validate these preliminary results, Study 3 developed a full factorial experimental design wherein the interaction effect between the nature of the premium and product‐premium fit on consumers’ liking, purchase intention and positive word‐of‐mouth was evaluated. This study confirmed the existence of a significant interaction effect and the direction of the simple effects was consistent with findings from Studies 1 and 2. However, the differences were only significant at a low‐fit condition.     

Are duty drawbacks on exports worth the hassle?

Abstract.  Many countries use duty drawbacks on exports, yet there is no consensus whether countries should embrace or abandon them. The answer depends on countries' development priorities and economic conditions. An increase in the drawback has a positive impact on export competitiveness, but the welfare effect is ambiguous. A welfare increase is more likely if the economy is small with high input tariffs, low initial drawback, low administrative costs and tariff leakages. In China duty drawback removal after meeting its WTO commitments improves welfare, but hurts economic efficiency, export competitiveness, and real incomes. Further liberalization can mitigate these negative effects.     

Procompetitive Effects of Foreign Competition on Domestic Markups

A short-run model for estimating the procompetitive effects of foreign competition on markups in an oligopolistic, domestic industry is developed and estimated using data on the Australian automobile industry. Estimates reveal that these effects are rather large and cannot be ignored when predicting the effects of a shock affecting foreign costs. These estimates can also facilitate inferences about the nature of interfirm rivalry.     

Market structure and the impact of imports on price cost margins

This paper provides a conceptual analysis of the impact of imports on domestic price-cost margins via the interaction of economies of scale, conjectural variations, and demand elasticities. Positive or negative impacts can be theoretically justified based on the relative strength of these factors.     

Long term spread option valuation and hedging

This paper investigates the valuation and hedging of spread options on two commodity prices which in the long run are in dynamic equilibrium (i.e., cointegrated). The spread exhibits properties different from its two underlying commodity prices and should therefore be modelled directly. This approach offers significant advantages relative to the traditional two price methods since the correlation between two asset returns is notoriously hard to model. In this paper, we propose a two factor model for the spot spread and develop pricing and hedging formulae for options on spot and futures spreads. Two examples of spreads in energy markets – the crack spread between heating oil and WTI crude oil and the location spread between Brent blend and WTI crude oil – are analyzed to illustrate the results.     

Ecological consumer behaviour: an empirical analysis

Increasingly, consumers choose ecological products when they do the shopping, not only because it is a healthier option but also because it helps to sustain the environment for future generations. They are prepared to switch products for ecological reasons and stop buying products from companies that cause pollution. Firms and other economic institutions are aware of the importance of reflecting these attitudes towards the environment in developing their products. This paper is focused on environmental attitudes as meaningful predictor of ecological behaviour. A three‐dimensional approach to this variable has been developed, which addresses its emotional, cognitive and conative components. A random sample survey of 573 individuals was used to verify the conceptual model and framework. This model was assessed initially by principal factor analysis and subsequently, by structural equation modelling. Findings of this study showed that environmental attitudes have a significant effect on ecological behaviour. This research improves our understanding of how consumers feel and what attitudes best define their way of behaving in relation to environmental problems.