Annuity Values in Defined Contribution Retirement Systems: Australia and Singapore Compared

Annuities promise to play an increasingly important role in countries with national defined contribution retirement systems. In this article we examine life annuities in two countries, Singapore and Australia, each of which has a national mandatory pension program. Exploiting data on annuity pricing and purchase behaviour, we compare the money's worth of life annuity products across these two nations. Our results indicate that, after controlling on administrative loadings, there are important differences in measured adverse selection. Part of the explanation may be due to the different structures of the two countries’retirement systems.     

AN EVALUATION OF PROCESS‐ORIENTED SUPPLY CHAIN MANAGEMENT FRAMEWORKS

Supply chain management (SCM) is implemented by integrating corporate functions using business processes within and across companies. Several process‐oriented frameworks for SCM have been proposed but only two of these provide sufficient detail to enable implementation. We evaluate the Supply‐Chain Operations Reference (SCOR) framework and The Global Supply Chain Forum (GSCF) framework using four criteria and identify their relative strengths and weaknesses.     

Characteristics of Risk and Return in Risk Arbitrage

This paper analyzes 4,750 mergers from 1963 to 1998 to characterize the risk and return in risk arbitrage. Results indicate that risk arbitrage returns are positively correlated with market returns in severely depreciating markets but uncorrelated with market returns in flat and appreciating markets. This suggests that returns to risk arbitrage are similar to those obtained from selling uncovered index put options. Using a contingent claims analysis that controls for the nonlinear relationship with market returns, and after controlling for transaction costs, we find that risk arbitrage generates excess returns of four percent per year.     

Social distance and shopping behavior

This research was designed to see whether a reconceptualization of social distance (as measured by social class variables) between shoppers and stores would provide a basis for understanding store avoidance behavior. A survey of shoppers classified into two distinct social classes investigated their images, including social class images, of two stores that had been selected as representatives of upscale and downscale retailers. A new measure of social distance was proposed and evaluated. Controlling for other functional aspects of store image such as price and personnel, the social distance measure was found to be influential in discriminating shopping frequency groups for the two stores, providing evidence that people tend to avoid stores that are perceived as being socially distant from themselves.     

A measure of alienation from the marketplace

For the purpose of equipping researchers in marketing with a more sophisticated method to measure alienation in a marketing context, the authors have constructed and initially tested an alienation from the marketplace index. Alienation is defined in terms of Melvin Seeman's (1959) five basic variants of alienation: powerlessness, meaninglessness, normlessness, social isolation, and self-estrangement. After pretesting, two questions per variant of alienation remained as the operational measures of alienation from the marketplace. These questions focused specifically on marketing phenomenon. Test-retest reliability was tested with 35 paired observations. Validity was checked with survey data from 140 households. In terms of face or content validity, the questions met the criterion of “looking as if” they should indicate the corresponding dimensions of alienation. Correlations between the marketplace alienation items and a measure of general alienation established concurrent validity. The authors propose that the use of the marketplace alienation index in studies involving those who are affected by our country's business climate may prove useful. For example, one would hypothesize that increasing alienation from the marketplace would be associated with support of consumerist goals, or even of additional government legislation to control problems that the individual feels is uncontrollable by him because of the bigness and indifference of modern day enterprise. Pepsico, Inc.     

The home purchase process: Measurement of evaluative criteria through pairwise measures

Although the purchase of a home represents a sizable investment for the average family, relatively little consumer research pertaining to the home purchase process has been reported. This investigation utilized Thurstone's Case V methodology to identify key attributes used by consumers to make housing choices and to show how these attributes are perceived by consumers of different tenure and socioeconomic status. The pairwise comparison analysis showed a strong preference for the attributes “safety and security from crime” and “quality construction” by the respondents. In addition, the analysis revealed several important differences in attribute preferences between former owners and former renters. Former home owners, for example, were more likely than former renters to prefer school quality when it was pitted against several other attributes. Thurstone's Case V techniques was found to be an effective method for measuring consumer preferences. Implications which focus on home product development and marketing strategies are discussed.     

Cost Structures and Nash Play in Repeated Cournot Games

This paper reports an experiment designed to assess the effects of a rotation in the marginal cost curve on convergence in a repeated Cournot triopoly. Increasing the cost curve's slope both reduces the serially-undominated set to the Nash prediction, and increases the peakedness of earnings. We observe higher rates of Nash equilibrium play in the design with the steeper marginal cost schedule, but only when participants are also rematched after each decision. Examination of response patterns suggests that the treatment with a steeper marginal cost curve and with a re-matching of participants across periods induces the selection of Nash Consistent responses.     

Measuring market response to regulation of the cable TV industry

During the 1988–1990 period, the cable television industry was subject to a number of regulatory events. These centered on possible reregulation of rates for basic service and reduction of entry barriers for potential competitors. Using the event study methodology on a portfolio of cable firms, we find evidence that news of no reregulation caused significant positive abnormal returns. News of reregulation caused insignificant negative abnormal returns. These findings provide some support for the traditional consumer protection theory of regulation. News related to entry barriers generally had no significant effect on returns, which suggests that elements of natural monopoly may exist in the industry.