The evaluation stage in marketing decision making

Prior to making important decisions, marketing managers go through an evaluation process in which available alternatives are compared. Yet, no systematic discussion of the evaluation process exists in the marketing literature. This article reviews the marketing and behavioral decision theory literature in order to identify factors that may cause errors in the two fundamental elements of the evaluation process—the estimation of probabilities and the determination of the value of outcomes. Propositions are developed that specify circumstances in which marketing management decisions may be influenced by judgmental biases, and procedures are identified for debiasing such judgments.     

Uniform Commercial Policy, Illegal Trade, and the Real Exchange Rate: A Theoretical Analysis

Countries on fixed exchange rates sometimes use uniform tariffcum subsidy (UTCS) schemes as a way of achieving a real depreciationwithout disturbing the nominal exchange rate. A potential drawbackof this policy in relation to an across-the-board devaluationis that a UTCS scheme provides incentives for illegal trade.Using an optimizing model with currency convertibility and illegaltrade. I find that welfare is lower under a UTCS scheme thanunder a corresponding across-the-board devaluation and thatin some cases the real exchange rate actually appreciates inresponse to an increase in the UTCS rate.     

Explaining Differences in Economic Performance Among Racial and Ethnic Groups in the USA

A bstract . By utilizing self-reported race and ancestry in the 1980 and 1990 USA censuses and the Blinder-Oaxaca decomposition technique, the extent of wage discrimination experienced by women and by men is examined across 50 ethnic/racial groups. Systematic evidence of negative discrimination is revealed in both census years for Asian, Indian, black (African-American), Vietnamese, Cuban, Mexican, Puerto Rican , and Native American males. To assess the charge that the Blinder-Oaxaca decomposition indicates cultural rather than discriminatory differentials, two additional data experiments are performed—one that controls for color and varies culture, and one that controls for culture and varies color. Race appears to matter.     

Up in the Air: GTE's Experience in the MTA Auction for Personal Communication Services Licenses

In late 1994, GTE, one of the largest telecommunications firms in the world, entered an auction for the rights to provide personal communications services (PCS) using the electromagnetic spectrum. The administering agency, the Federal Communications Commission, adopted a novel multiple-round format for the PCS auction. The format presented GTE with a complex bidding problem. This article describes how the GTE bidding team answered the following question: Given its budget and valuations and the information available about rival bidders, how should GTE bid to achieve the best attainable outcome?     

A note on forecasting international tourism demand in Spain

This paper considers the extent to which price and income proxy variables help in forecasting tourist demand in Spain. Contrary to some recent studies, we found that the inputs' contribution in terms of fitting and forecasting is nil when compared with alternative univariate models. Whether these findings are the results of the restrictions embedded in building the proxy inputs or in a poor specification of the dynamics of these models remains to be seen. We also contend that when dealing with medium, long-term forecasting comparisons, the use of the traditional aggregate accuracy measures like RMSE and MAPE help very little in discriminating among competing models. In these situations, predicted annual growth rates may be a better alternative.     

Changes in REIT Liquidity 1990–1994: Evidence from Intra-day Transactions

This study uses data on intra-day transactions to analyze whether real estate investment (REIT) liquidity as measured by the bid-ask spread changed from 1990 to 1994, a period during which the industry's market capitalization increased from $8.7 billion to $45 billion. REIT percentage spreads (spread as percentage of share price) narrowed significantly, primarily attributable to higher share prices rather than narrower dollar-value spreads. An empirical model is used to analyze the determinants of percentage spreads. Return variance and share price, not market capitalization are found to be the primary determinants of percentage spreads in both periods. This suggests that the liquidity of REIT securities is similar to that of non-REIT securities with similar prices and return variance. In addition, percentage spreads are wider for REITs trading on the NASDAQ.     

Snapshot samples

We consider a coverage model where an initial event that occurs at some point in time triggers an activity of random duration that leads to some subsequent event. A snapshot sample is constructed at a fixed point in chronological time either by sampling only subjects where the initial event has occurred but the subsequent event has yet to occur (active subjects), or by sampling only subjects where both the initial and subsequent events have occurred (inactive subjects). The biases inherent in snapshot sampling can be neatly characterized by the properties of two random variables: the history (defined as the time the initial event occurs as measured into the past from the chronological point of sampling), and the active time (defined as the length of time between the initial and subsequent events). Though snapshot samples are biased, recognizing the biases enables correct inferences to be drawn from snapshot-sampled data. Considering only the case where and are independent random variables, this paper presents the probability models associated with snapshot sampling, demonstrates the problems that can occur, offers procedures for overcoming these problems, and applies the methods to interesting data sets.     

Tourism and local economic development: The case of the Highlands Meander

Local economic development (LED) planning is of major policy importance in post-apartheid South Africa. Although issues surrounding LED have attracted considerable policy attention, one neglected theme has been the role of tourism as a lead sector for LED. The aim of this article is to examine the planning and workings of one tourism-led LED initiative in South Africa. The case study is that of the Highlands Meander in Mpumalanga province, where five towns are collaborating in their LED initiatives in order to promote the area's tourism products. A key finding is that this growing tourism initiative is currently not benefiting local black communities. Recommendations are offered for developing a pro-poor tourism initiative.