Can free-shipping hurt online retailers?

Quantitative Marketing and Economics - In this paper, we investigate optimal pricing strategies for an online grocery retailer that derives its profits from delivery fees and grocery sales. We base...     

The demand for alcoholic beverages in Spain

The objective of this study is to analyze the main determinants of alcoholic beverages consumption at home. Data comes from the latest Spanish Household National Survey, which provides information on expenditure and quantities of different food products by household. Because households are interviewed only 1 week, a large number of zeros have been recorded. Among the existing censured demand models (the double hurdle (DH) model; the purchase‐infrequency model; and the Tobit purchase‐infrequency model, among others) and after carrying out model selection tests, the DH model has been finally estimated. All expenditure elasticities are positive, corresponding the highest value to spirits. Own price elasticities are negative and also in this case the spirits exhibit the highest value. Socio‐economic variables also play an important role in explaining consumer purchase and consumption decisions.     

Assessing Consumers’ Willingness to Pay for Different Units of Organic Milk: Evidence from Multiunit Auctions

Experimental auctions are normally conducted using single‐unit auctions. In this paper, we use the multiunit Vickrey auction to assess the determinants of consumers’ willingness to pay (WTP) for organic milk in a multiunit shopping scenario. We also analyze the effect of positive and negative information about organic farming on WTP. Our results suggest that consumers are willing to pay a premium for organic milk but that this WTP decreases with the number of units purchased. Results also suggest that health issues, high price of organic foods, taste, and lack of information on organic foods are factors that influence WTP for organic milk. The type of information provided also plays a relevant role. Specifically, we found that subjects’ WTP responds positively to positive information about organic farming and responds negatively to negative information. The provision of both positive and negative information does not affect WTP. Les enchères expérimentales sont en règle générale effectuées sous un cadre d’enchères de Vickrey à une seule unité. Dans le présent article, nous avons utilisé l’enchère de Vickrey à unités multiples pour évaluer les déterminants du consentement à payer (CAP) des consommateurs pour du lait biologique dans un contexte d’achats multiples. Nous avons également examiné les répercussions que l’information positive et négative à l’égard de l’agriculture biologique a sur le CAP. Nos résultats autorisent à penser que les consommateurs sont prêts à payer un prix plus élevé pour obtenir du lait biologique, mais que ce CAP diminue avec le nombre d’unités achetées. Nos résultats autorisent aussi à penser que les aspects liés à la santé, le prix élevé des aliments biologiques, le goût et le manque d’information sur ces aliments sont des facteurs qui influencent le CAP pour du lait biologique. Le type d’information joue également un rôle important. Nous avons observé que le CAP réagit favorablement à de l’information positive sur l’agriculture biologique et défavorablement à de l’information négative. La diffusion simultanée d’information positive et négative n’influence pas le CAP.     

The impact of the 1999 CAP reforms on the efficiency of the COP sector in Spain

The cereal, oilseeds, and protein crop sector (COP) occupies a prominent position within the European Union's agricultural sector. Within Spain, the COP sector accounts for almost a third of total Agricultural Guidance and Guarantee Fund expenses, and half of the utilized agricultural area (UAA). The COP sector is not only relevant because of its physical and economic magnitude, but also because of the political attention it receives. The Common Agricultural Policy (CAP) reforms that occurred during the 1990s paid special attention to this sector. This article aims to determine the impacts of Agenda 2000 on a sample of Spanish COP farmers' production decisions by using an output-oriented stochastic distance function. The distance function allows for an assessment of the reform-motivated changes on total output, input used, input composition, and crop mix. It also permits an assessment of the impacts of the reform on farms' technical efficiency.
Results show that the reform has shifted the production frontier inward and changed output composition in favor of voluntary set-aside land. With respect to input composition, Agenda 2000 induced a decrease in land, fertilizers, pesticides, and other inputs in favor of labor. In addition, Agenda 2000 has had a negative impact on technical efficiency.     

Persistence,Long Memory,and Unit Roots in Commodity Prices

This article investigates the degree of persistence in several weekly and monthly agricultural prices (corn, soybeans, barrow and gilts, and milk) using long memory (fractional integration) techniques. The results indicate mean reversion (i.e., orders of integration smaller than one) in some of the agricultural prices like corn, milk, and barrow and gilts when the disturbances are autocorrelated. Further, we examine the stability across time in the degree of dependence, and the results indicate that the fractional differencing parameters have not remained constant across time. When we take into account a structural break we find that during the first subsamples, the series are stationary though highly persistent, with orders of integration close to 0 and with large autoregressive coefficients. However, for the periods after the break, the series seem to be nonstationary I(1). Dans le présent article, nous avons étudié le degré de persistance des prix hebdomadaires et mensuels de plusieurs produits agricoles (maïs, soja, castrats et cochettes, lait) à l’aide de tests de mémoire longue (intégration fractionnaire). Nos résultats indiquent une stationnarité (c.‐à.‐d. des ordres d’intégration inférieurs à un) des prix de certains produits agricoles, tels que le maïs, le lait, les castrats et cochettes, lorsque les perturbations sont autocorrélées. Nous avons également étudié la stabilité du degré de dépendance à travers le temps, et nos résultats indiquent que les paramètres de différenciation fractionnaire ne sont pas demeurés constants. Lorsque nous avons tenu compte d’une rupture structurelle, nous avons trouvé que dans les premiers sous‐échantillons, les séries étaient stationnaires quoique très persistantes, avec des ordres d’intégration près de 0 et d’importants coefficients d’autorégression. Dans le cas des périodes suivant la rupture, les séries semblaient non stationnaires I(1).     

IS THERE AN ASYMMETRIC BEHAVIOUR IN AFRICAN INFLATION? A NON‐LINEAR APPROACH

In this paper we test the inflation persistence hypothesis as well as model the long‐run behaviour of inflation rates in a pool of African countries using a non‐linear framework. In order to do so, we rely on unit root tests applied to non‐linear models and fractional integration. The results show that the hypothesis of inflation persistence does not hold empirically for most of the countries. In addition, the estimated models (logistic smooth transition autoregressions) are stable in the sense that the variable tends to remain in the regime (low inflation or high inflation) once reached, and changes between regimes are only achieved after a shock. The results also indicate that the effects of the shocks on inflation tend to die out; exogenous factors, i.e. supply shocks and inertia may be causing this outcome, as they play a substantial role in the determination of the inflation rates for our selected African countries.     

Antecedents to complaint behaviour in the context of restaurant goers

Abstract

This article deals with the process by which consumer complaint behaviour is formed. The general aim is to analyse the nature of this type of response to dissatisfaction, describing its development in terms of how it is influenced by a combination of several factors already researched in the literature. The most relevant contributions from the related theoretical work indicate that public and private responses (complaint behaviour) are the most common reactions of consumers when faced with a dissatisfactory experience. A group of determinants which influence these responses in different ways has also been identified. The main objective of this study is to analyse the relationship between the different determinants of complaint behaviour with the aim of identifying the variables which exert the greatest influence.     

Using metaphors in new brand design

This paper addresses an important gap in brand development. While attention has been rightly focused on consumer understanding of brand imagery, insufficient attention has been given to how the firm's managers create, understand and communicate to each other something so intangible as a future brand's vision. We demonstrate how using metaphors in brand design enhances the ability of a cross‐functional team to create a coherent brand vision: facilitating both creativity and its communication. Brand visions are vital given the essential periodic improvements and mutations brands must undergo, without sacrificing the integrity and values which drive their purchase. Management complexity arises because brand development happens in a multi‐disciplinary environment. Moreover these different managers must translate the intangible meanings held by consumers into very tangible product and service specifications. The role and nature of metaphor in this process is examined in detail. We then provide practical examples of how this technique has been used with managers in a variety of branding tasks.     

The Role and Determinants of Concession Sales in Movie Theaters: Evidence from the Spanish Exhibition Industry

The importance of concession sales in the movie exhibition industry is widely acknowledged among economists and other social scientists that have studied this industry in the past. Despite this recognition, the lack of appropriate data has constrained existing studies that document the role that concessions play in movie theaters. Using detailed weekly movie theater data on concession sales, box office revenues and transaction characteristics from a major exhibitor in Spain, we shed light on the relation between concession sales and the following factors (i) theater attendance, (ii) non-traditional channels of ticket distribution, (iii) audience composition, and (iv) theater and market specific factors.