Consumer sorting and hedonic valuation of wine attributes: exploiting data from a field experiment

This article uses a novel experimental approach to measure consumer willingness to pay (WTP) for wine attributes. We invited customers of a local supermarket who had selected a bottle of wine to purchase to participate in a valuation experiment. Integrating their original wine choice into the experiment, each participant evaluated six alternative wines, generating a rich set of data on willingness to pay and consumer characteristics. The data from the experiment allow us to compare standard shelf price‐based wine attribute valuation estimates with estimates using WTP data and an increasing amount of information about individual consumers. The full model employs individual fixed effects to estimate WTP parameters without bias from consumer sorting or supply side influences. Our WTP estimates for wine attributes differ markedly from previous attribute value estimates. Consumers in our sample display clear and stable preferences for wine varieties, but less clear preferences for appellations. Our results suggest caution is needed in using market prices to estimate parameters of the consumer valuation function for product attributes.     

John Dewey and Henry George: The Socialization of Land as a Prerequisite for a Democratic Public

John Dewey frequently praised Henry George, author of a plan to confiscate land values with a “single tax.” Scholars have failed to account for Dewey's support of George. Some have argued that it should not be taken seriously because it is at odds with their interpretation of Dewey's philosophy. This article demonstrates that Dewey perceived the socialization of land values as an essential step toward creating a true democracy. Furthermore, Dewey's interest in George was not an aberration; it was exemplary of his faith in ideology, theory, and transformative social policy. Despite contentions to the contrary, pragmatists of the early 20^th century never emphasized skepticism, moderation, or rote empiricism. In fact, Dewey embraced the philosophy of Henry George as a general theory of history of society. During the Great Depression, Dewey attacked the piecemeal reformism of the New Deal in favor of the comprehensive vision of Henry George.     

Land Value Taxation in Vancouver: Rent‐Seeking and the Tax Revolt

At the beginning of the 20^th century, Vancouver obtained international acclaim as a “single‐tax” city. Supporters claimed that land value taxation was responsible for the spectacular growth of the city. Even critics believed that it had produced a building boom and declining rents. Yet, over several decades, the system was scaled back and ultimately ended in 1984. This article argues that the property tax revolt can be understood with Mancur Olson's model of collective action. Property owners are better organized than other parties impacted by housing policy because they have financial resources and a salient economic concern in housing. Thus, the special interests of property owners in higher values and unrestricted use prevailed over the interests of tenants and prospective buyers. While the property tax revolt was often articulated in the progressive language of ability to pay, when confronted with progressive counterarguments, it collapsed into explicit arguments for rent‐seeking.     

Preventives Versus Treatments Redux: Tighter Bounds on Distortions in Innovation Incentives with an Application to the Global Demand for HIV Pharmaceuticals

Kremer and Snyder (Q J Econ 130:1167–1239, 2015) show that demand curves for a preventive and treatment may have different shapes though they target the same disease, biasing the pharmaceutical manufacturer toward developing the lucrative rather than the socially desirable product. This paper tightens the theoretical bounds on the potential deadweight loss from such biases. Using a calibration of the global demand for HIV pharmaceuticals, we demonstrate the dramatically sharper analysis achievable with the new bounds, allowing us to pinpoint potential deadweight loss at 62% of the global gain from curing HIV. We use the calibration to perform policy counterfactuals, assessing welfare effects of government policies such as a subsidy, reference pricing, and price-discrimination ban. The fit of our calibration is good: we find that a hypothetical drug monopolist would price an HIV drug so high that only 4% of the infected population worldwide would purchase, matching actual drug prices and quantities in the early 2000s before subsidies in low-income countries ramped up.     

Introduction to the Special Issue on “The Intersection Between Industrial Organization and Healthcare Economics”

This article introduces the special issue on the intersection between industrial organization and healthcare economics. This intersection has received increasing research interest, growing from 2% of the industrial-organization literature in 1991 to 6% in 2016. We describe the nine included articles, which cover a range of healthcare markets that include hospital services, insurance, and pharmaceuticals.     

Perspective: Understanding the Nature and Measurement of the Lead User Construct

The lead user concept has attracted a lot of attention from scholars and practitioners alike. However, different studies apply different conceptualizations and measures of the lead user construct. Such variation in measurement of the construct make it almost impossible to consolidate findings from prior lead user research, which in turn hampers the accumulation of insights on the concept itself. This is also a challenge with respect to managerial practice: due to different interpretations of the concept, managers and R&D staff find it difficult to identify lead users for workshops and cooperation, and companies are often unable to transfer results from lead user projects to new product and business development. As a result, they only rarely repeat their work with lead users. The aim of this article is therefore to provide some thoughts and guidance on the conceptualization and measurement of the lead user construct.     

MONOPOLISTIC LOCATION CHOICE IN A TWO‐SIDED HOTELLING MODEL

We analyse the optimal location choice of a monopolistic firm that operates two arbitrarily located platforms on a two‐sided market. By extending the traditional Hotelling framework, we show that the optimal platform locations are equivalent to the one‐sided benchmark if both sides are either restricted to single‐ or multi‐homing. In the mixed case (one side single‐homes, the other one multi‐homes), the optimal platform locations are in line with the respective symmetric case. If the monopolist is restricted to choosing the same location on either side of the market, the optimal locations are determined by the relative profitability of the market sides.     

Managing five paradoxes of knowledge exchange in networked organizations: new priorities for HRM?

The life‐blood of most organizations is knowledge. Too often, the very mechanisms set up to facilitate knowledge flow militate against it. This is because they are instituted in a top‐down way, they are cumbersome to manage and the bridges of trust fail to get built. In their thirst for innovation, the tendency is for firms to set up elaborate transmission channels and governance systems. As a result, staff are drowned in a deluge of mundane intranet messages and bewildered by matrix structures, while off‐the‐wall ideas and mould‐breaking insights are routinely missed. Added to this is the challenge of operating across professional, cultural, regional and linguistic boundaries, where ways of sharing knowledge differ markedly, even within the same project team. Drawing upon extensive research with scientists in the ATLAS collaboration (a high‐energy particle physics experiment comprising 3,500 scientists from 38 countries), we explore five paradoxes associated with knowledge exchange in global networks. Each paradox leads to a proposition which takes the theory and practice of knowledge management in a fresh direction. We conclude by outlining a number of HRM priorities for international knowledge‐intensive organizations.     

Medical Malpractice Liability and Physician Migration

This paper uses national data on individual physicians and two control groups to provide evidence on the extent to which each of five medical malpractice reforms impacts the decision to move one's medical practice to another state. We find robust evidence that states that have implemented noneconomic damage caps experience less out-migration of physicians than states that do not have these reforms. In addition, we find some evidence that joint and several liability reforms and patient compensation funds also impact the migration decisions of physicians.