Brand misconduct: Consequences on consumer-brand relationships

This paper investigates the effects of brand misconduct on a consumer-brand relationship. Brand misconduct describes a brand's behavior that disappoints consumers' expectations of the brand, for example the alleged use of child labor in soccer ball factories contracted by Adidas, Nike and Puma. Based on relationship and congruency theory, this paper develops a model to explain consumer-brand relationship and its impact on consumers' repurchase intentions. According to this model, functional congruence, actual and ideal self-congruence, partner quality and brand relationship quality represent factors determining repurchase intention. An empirical investigation with regard to jeans brands serves to test the postulated relationships in two distinct situations: before and after brand misconduct. On the one hand, the findings provide a deep insight into the consequences of brand misconduct. On the other hand, the results enable practitioners to develop sustainable brand strategies and create lasting brand preferences.     

Belief-free price formation

We analyze security price formation in a dynamic setting in which long-lived dealers repeatedly compete for the opportunity to trade with short-lived retail traders. We characterize equilibria in which dealers’ pricing strategies are optimal irrespective of the private information that each dealer may possess. Thus, our model’s predictions are robust to different specifications of the dealers’ information structure. These equilibria reconcile, in a unified and parsimonious framework, price dynamics that are reminiscent of well-known stylized facts: excess price volatility, price to trading flow correlation, stochastic volatility and inventory-related trading.     

AVB und Beratungspflichten – Markt – und Produktdisposition

Although insurers over services, they are no advisers/consultants. Nevertheless, the jurisdiction has already established an pre-contractual insurers duty to l advise insureds under the validity of the old VVG according to general civil law rules. Article 6 VVG standardizes such duties for the first time and aims to guarantee customers proper advice/consultancy particularly before the contract ends to prevent lapses in coverage. Therewith some considerable questions referring to concurrent laws concerning the law of the general terms and conditions, which aim to guarantee reliable and transparent information for customers in a quite similar way, arise. The author discusses this problem of concurrent laws and develops criteria which show which law is applicable on what occasion. As a result, a possibly contradictory pre-contractual double review is avoided.     

Deregulation and dairy production systems: a Bayesian distance function approach

Milk quota trading rules differ across EU member countries. In Denmark a biannual milk quota exchange was set up in 1997 to promote a more efficient reallocation of milk quotas as well as to reduce transaction costs related to the searching and matching of sellers and buyers. Using two comprehensive unbalanced panel data sets on organic and conventional milk farms this study attempts to disentangle the effects of the introduction of quota transferability on the production structure of those farms as well as the probability of market entry/exit. Bayesian estimation techniques are used to estimate an input oriented generalized Leontief distance function as well as a curvature constrained specification. The results suggest that the deregulation in the quota allocation mechanism led to an increased allocative efficiency of organic as well as conventional milk production as well as a relative shift of the PPF in favor of the production of organic milk.     

Do traders learn to select efficient market institutions?

Experimental Economics - When alternative market institutions are available, traders have to decide both where and how much to trade. We conducted an experiment where traders decided first whether...     

Monetary Reference Points of Managers – Empirical Evidence of Status Quo Preferences and Social Comparisons

We explore whether monetary reference points affect managers′ job satisfaction. These reference points include a manager′s own status quo and the incomes of comparable managers within the same firm and also at the market level. Making use of a unique panel data set of managers in the German chemical sector, we find that social comparisons of compensation do affect reported job satisfaction. Both the relative income position within a manager's own firm and a manager's wage rank on the market have positive relations with job satisfaction. There is no evidence of the relevance of status quo considerations once we control for firm‐related pay variables.