Brand equity: extending brand awareness and liking with Signal Detection Theory

Brand equity, which is a central topic in modern marketing, may be assessed from three perspectives: customer mind set, product market outcomes and financial market outcomes. Brand awareness (memory) and brand liking are elements of customer mind set brand equity. The factors determining brand awareness and likeability are also determinants of the change in financial brand equity. In order to understand these factors, Signal Detection Theory is employed for finding the components of brand awareness and likeability. Signal Detection Theory has a strong tradition in psychology, but is under‐represented in marketing and consumer behaviour. This study extended the concept of brand awareness to ‘awareness sensitivity and bias’ and the concept of ‘brand likeability’ to ‘liking sensitivity and bias’ using Signal Detection Theory. The effect of divided attention on the extended components was investigated in three laboratory experiments. It was found that, in the attended mode compared with the unattended mode, consumers perform better in preserving a favourable brand awareness and have a conservative reaction tendency. This effect of attention occurs in building brand awareness for short presentations, but not for long presentations. These findings may serve as guidelines for a strategy formulation for enhancing customer mind set brand equity.     

Don't Trust Trust: A Dynamic Approach to Controlling Supplier Involvement in New Product Development

Prior literature stresses the importance for manufacturers to use formal and informal controls to coordinate collaborative new product development activities with suppliers. In doing so, the existence of trust between manufacturers and suppliers is believed to play a key role because it enables manufacturers to reduce investments in formal controls and rely more on less costly informal controls. Manufacturers and suppliers don't suddenly trust each other though: trust typically grows over time as the partners get to know each other. Trust may also decrease if manufacturers overuse formal controls or if suppliers underperform. These fluctuations in trust over the course of supplier–manufacturer relationships complicate the so‐called trust–control nexus and raise important questions about the impact of trust on the efficiency and effectiveness of formal and informal controls as coordination mechanisms. Therefore, this study examines how manufacturers should balance formal and informal controls over time to reap the full benefits of collaborative product development with suppliers. For that purpose, a conceptual and system dynamics model are developed, which incorporate the links among formal and informal controls, trust, and the supplier's development performance. In an empirical validation in the context of the shipbuilding industry, the results reject the notion that manufacturers must lessen formal controls and increase informal controls with trust. Instead, it is most efficient and effective to invest always in formal controls, particularly process control, to coordinate supplier involvement in new product development. These results have important theoretical and managerial implications: Informal controls are not as profitable as expected.     

Market-hampering Land Speculation: Fiscal and Monetary Origins and Remedies

A bstract Market-hampering land speculation destabilizes and distorts development, and shifts income unjustly to landowners. Its fiscal origin is the lack of public collection of the site rent. The monetary origin is a centrally controlled money supply that injects excessive credit, fueling malinvestments in real estate. The remedies are both the public collection of land rent and a free market in money and banking, hence a money supply that responds flexibly to market demand while maintaining a stable unit of account. Rent collection option contracts could increase the scope of market-enhancing land speculation that spreads and reduces risk.     

Using food prices and consumption to examine Chinese cost of living

This paper considers two approaches to examining potential bias in China's consumer price index: (i) inferring true changes in cost of living from consumer behaviour; and (ii) creating alternative price indices to compare with official indices. For (i), our semi‐parametric estimates agree with the recent finding of a large understatement in increases to the true cost of living. For (ii), we focus on food prices and explore potential causes of bias. We find some evidence of a new‐good bias. China's large‐scale migration also causes changes in the cost of living that are not reflected in the consumer price index.     

Can the United States Transform Itself Into an Exporting Juggernaut?

The United States is capable of becoming an exporting juggernaut if it follows the right policies. This paper discusses what goals the United States should pursue and how it should go about reaching them. The goals should be ambitious—more ambitious than current policy suggests. Gross exports should increase to about 20 percent of GDP, whereas the current account deficit should decline to about 2 percent. The most important instruments to achieve these goals are liberalization of export controls, aggressive pursuit of trade agreements, and exchange rate correction—particularly with China. The paper gives estimates of what can be achieved by these instruments.