Advertising Spending and Perceived Quality

Marketing Letters - In this paper we examine the relationship between advertising spending and perceived product quality. The questions we ask are: Does a product's advertising spending...     

TIME-VARYING TERM PREMIA AND THE BEHAVIOR OF FORWARD INTEREST RATE PREDICTION ERRORS

In this paper I examine the time-varying expected term premium argument for the failure of the expectations hypothesis of the term structure of U.S. interest rates. Using an unobserved components model to estimate expected term premia from March 1951 to January 1991, I find considerable variation in estimated premia and significant persistence in their volatility over time.     

Theoretical Implications of Imperfect Competition on Quota License Prices and Auctions

This article looks at the implications for trade policy of recentwork on quota auctions. Recent work has considered a varietyof market structures in addition to the standard one of monopolyin the product market. It has also emphasized details of theimplementation process, as well as the timing of decisions anddynamic factors. Such considerations are shown to be important,because they can greatly affect the outcome of trade policies.     

Innovation pathway to profitability: the role of entrepreneurial orientation and marketing capabilities

Drawing from the marketing capabilities and innovation literatures, we identify aprocess by which a firm’s entrepreneurial orientation impacts profits and show that it is dependent on marketing capabilities. Using a half-longitudinal design we integrate survey data with performance metrics over two time periods, from a sample of 190 firms. While the effect of entrepreneurial orientation (EO) on innovation is enhanced by architectural marketing capabilities, the effect of innovation outcomes on profits is enhanced by specialized marketing capabilities. Ultimately, the pathway from EO to performance, mediated by innovation, is positively significant at higher levels of both marketing capabilities. The results uncovered using Bayesian conditional process modeling, are robust to alternate model specifications, endogeneity tests, and provide insights into the capabilities-based understanding of entrepreneurism-marketing interface. We discuss resource allocation implications for managers as they attempt to maximize profits through innovation.     

Marketing and politics: Models, behavior, and policy implications

The American presidential election is one of the largest, most expensive, and most comprehensive marketing efforts. Despite this fact, marketing scholars have largely ignored this campaign, as well as thousands of others for congresspersons, senators, and governors. This article describes the growth of interest in research issues related to political marketing. This emerging research area lies at the crossroads of marketing and political science, but these fields have developed largely independent of one another with little cross-fertilization of ideas. We discuss recent theoretical, empirical, and behavioral work on political campaigns, integrating perspectives from marketing and political science. Our focus is on (1) the extent to which paradigms used in goods and services marketing carry over to the institutional setting of political campaigns, (2) what changes are necessary in models and methodology to understand issues in political marketing and voter behavior, and (3) how the special setting of politics may help us gain a better understanding of certain topics central to marketing such as advertising, branding, and social networks.     

Direct medical costs of treatment in newly-diagnosed high-grade glioma among commercially insured US patients

Aim: This analysis assessed the direct medical costs of newly-diagnosed, temozolomide (TMZ)-treated glioblastoma (GBM) from the perspective of a US commercial setting.

Materials and methods: The analysis included subjects identified from the IMS PharMetrics LifeLink Plus? claims database from January 1, 2008 to August 31, 2014 who were ≥18 years of age, had ≥1 malignant brain cancer diagnosis, had brain surgery ≤90 days prior to TMZ initiation, had TMZ treatment, and were continuously enrolled for ≥12 months pre-diagnosis and ≥1 month post-diagnosis. Per-patient per-month (PPPM) and cumulative costs from 3 months pre-diagnosis to various post-diagnosis follow-up time points were calculated. Multivariable analyses were used to estimate adjusted mean cost and identify contributors of cost.

Results: The study included 2,921 subjects (median age?=?56 years; 60% male). After diagnosis, the median (interquartile range, IQR) number of inpatient, emergency department, and outpatient visits were 2 (1–4), 1 (1–3), and 19 (13–27); median (IQR) length of stay per hospitalization was 5 (3–9) days. Mean total cumulative costs per patient from 3 months pre-diagnosis to 12 months and to 5 years post-diagnosis were $201,749 (197,490–206,024) and $268,031 (262,877–274,416). Mean (SD) PPPM costs were $818 (1,128) and $7,394 (8,676) pre- and post-GBM diagnosis, respectively. The variables most predictive of cumulative costs included radiation therapy (+$81,732), ≥2 weeks of hospitalization (+$49,629), and ≥7 MRI scans (+$40,105).

Conclusions: The direct medical costs of newly-diagnosed, TMZ-treated GBM in commercially insured patients are substantial, with estimated total cumulative costs of $268,031.     

Cournot competition in a differentiated oligopoly

This paper studies product-quantity equilibria in an oligopoly. Products are interpreted as “qualities” and each firm chooses a quality-quantity pair, simultaneously. It is well known that a pure-strategy equilibrium in product-price pairs does not exist in this model, but a pure-strategy equilibrium in product-quantity pairs exists. Furthermore, in an example widely studied in the literature, the equilibrium has nice asymptotic properties.     

Advertising Spending and Quality for Services: The Role of Capacity

In this paper we explore the relations among advertising spending, capacity and quality for services. Data from a sample of New York City restaurants show that mid-quality restaurants spend more on advertising than either high quality or low quality ones, contradicting the usual Nelson-type prediction that advertising spending increases with quality. Also, controlling for quality, restaurants with larger capacities advertise more. We present a model of services to explain these observations. The key features of the model are: (1) capacity constraints, (2) uncertain demand, (3) the presence of both informed and uninformed consumers, and (4) a technological link between capacity and quality. We argue that for services, advertising not only informs consumers, but it also can improve capacity utilization. Given this dual role, advertising is more valuable to firms with larger capacities and higher price-cost margins. The variation of these two elements with quality determines the advertising-quality relation.     

Incorporating Behavioral Anomalies in Strategic Models

Behavioral decision researchers have documented a number of anomalies that seem to run counter to established theories of consumer behavior from microeconomics that are often at the core of analytical models in marketing. A natural question therefore is how equilibrium behavior and strategies would change if models were to incorporate these anomalies in a consistent way. In this paper we identify several important and generalizable anomalies that modelers may want to incorporate in their models. We briefly discuss each phenomenon, identify a key unresolved issue and outline a research agenda to be pursued.