Using structural restrictions to achieve theoretical consistency in benefit transfers

Analysts often extrapolate estimates of the value of environmental improvements reported in prior studies to evaluate new policy proposals, a practice sometimes referred to as “benefit transfer.” Benefit transfer functions are frequently specified based on statistical considerations alone. However, such a purely statistical approach can lead to willingness-to-pay functions that fail to satisfy some aspects of theoretical consistency that may be especially important for policy evaluations. In this paper, we examine several previous meta-analyses of nonmarket valuation studies in light of the adding-up condition, which is one important aspect of theoretical validity. We then use meta-regression to estimate a new willingness-to-pay function for surface water quality improvements intended to be used for benefit transfers. We estimate the meta-regression model using summary results from 51 previously published stated preference studies. An important feature of our approach is that we develop the meta-regression estimating equation to ensure that the resulting benefit transfer function will necessarily comply with the adding-up condition. This is achieved by first specifying a marginal willingness-to-pay function and then deriving an expression for total willingness-to-pay. This leads to a non-linear estimating equation, so we estimate the parameters of the model using non-linear least squares. We discuss the advantages and disadvantages of our approach relative to other structural approaches, and we compare our empirical results to a more traditional nonstructural meta-regression model. Finally, we examine the quantitative importance of imposing the adding-up condition in our case study by performing some illustrative calculations of willingness-to-pay for hypothetical water quality improvements using both structural and non-structural models.     

The Moderating Influence of Country of Origin Information Seeking on Homophily and Product Satisfaction

ABSTRACT

The purpose of the research was to investigate when consumers concurrently select a range of retail products online, what percentage of products need country of origin (COO) identification. Moreover, will COO information seeking positively moderate the relationship between homophily and product satisfaction. Participants were recruited through an online survey platform (MTurk). The results appear to be the first to quantify the number of retail products within a basket that need some form of country of origin (COO) identification. Electronic word of mouth (eWOM, e-reviews) has become an important factor in the purchasing process for consumers. When COO information is unavailable, consumers will search online reviews to determine the COO of products. When reading the e-reviews, consumers will also evaluate the reviewer and the similarities they share. If they are not similar (low in homophily) their satisfaction with the product is low. By contrast, when homophily is high, product satisfaction is high. Specifically, as homophily increases, an individuals' need for COO information seeking has a positive moderating effect on their perceived product satisfaction. Online retailers promoting their products could benefit from sales increases due to their ability to provide COO information at a low cost, which in turn, provides ease, peace of mind and purchase satisfaction for consumers.     

Will enterprise social networking systems promote knowledge management and organizational learning? An empirical study

ABSTRACT

Nowadays, enterprise social media practitioners and researchers are keen to know how the enterprise usage of social media can be converted into the improved organizational performance. Meanwhile, organizational learning has long been considered as one of the measures of organizational performance. This article investigated the impact of enterprise social networking systems (ESNS) usage on knowledge management processes and organizational learning; in particular, we examined the mediating role of knowledge creation and knowledge sharing. Four theories from sociology and strategic management were used to build the hypotheses in the research model. An online survey was conducted to empirically test the model. Our study results showed that ESNS usage directly and indirectly influences organizational learning; and that knowledge management processes (knowledge creation and sharing) mediate the path between the two. This study contributes to the existing literature on enterprise social media for three reasons. First, it is among the first to connect the three independent concepts (social media, knowledge management, and organizational learning) and explore their relationships in one theoretical framework. Second, this work also specifically examines the influence of ESNS (Yammer in this case) on organizational processes and outcomes. Third, this is a pioneering study that employs multiple theories to address the research questions under the organizational social media context. Therefore, the research gives implications for both practitioners and scholars who are interested in understanding the effectiveness of ESNS usage in the modern organizations today.     

The legacy and promise of Vannevar Bush: rethinking the model of innovation and the role of public policy

The linear model of innovation argues that innovation takes place in a unidirectional sequence, with basic research directly diffusing in marketable product or process innovations. This perspective has served society well in past decades. However, recent productivity slowdowns in developed economies and the failure of innovation policies to continue to deliver desired results have called this perspective into question. Scholars explain these slowdowns by the oversimplification of the linear model which fails to consider the complexities associated with innovation processes. Although it is generally believed that Vannevar Bush’s report Science – The Endless Frontier – was based on his belief in a linear model of innovation and the notion that basic research is the ultimate source of all innovation, an examination of Bush’s writings and his life reveals that he believed in a more sophisticated model in which basic and applied research cross-fertilize each other and in which government’s job is not so much to stimulate basic research as it is to facilitate interactions between basic and applied research for the benefit of both and the prosperity of society. This paper explicates Bush’s model of the research and innovation process, explores the implications of that model, and derives policy recommendations.     

How do selling mechanisms affect profits,surplus, capacity and prices with unknown demand?

I analyze a model in which a seller wishes to sell multiple homogeneous goods to a large group of buyers with unknown demand. The seller may either sell objects via a posted‐price mechanism, a discriminatory‐price auction, a uniform‐price auction, their open‐bid analogs, or a revelation mechanism in which the seller first asks all potential buyers to report their valuations and then sets a reserve price. I show that the revelation mechanism leads to the greatest profits, the auction mechanisms result in identical expected profits and the posted‐price mechanism results in the smallest profits. However, the more profitable mechanisms impose stronger informational requirements that may make these mechanisms infeasible in practice, and the posted‐price mechanism also results in the greatest total surplus. I also find the seller chooses a lower capacity and reserve price in an auction than in the posted‐price mechanism.     

Management and cost analysis of cancer patients treated with G-CSF: a cohort study based on the French national healthcare insurance database

Objectives: To describe the management and costs associated with G-CSF therapy in cancer patients in France.

Methods: This study analyzed a representative random population sample from the French national healthcare insurance database, focusing on 1,612 patients with hematological or solid malignancies who were reimbursed in 2013 or 2014 for at least one G-CSF treatment dispensed in a retail pharmacy. Patient characteristics and treatment costs were analyzed according to the type of cancer. Then the costs and characteristics of patients associated with the use of different G-CSF products were analyzed in the sub-set of breast cancer patients.

Results: The most frequent malignancies in the database population were breast cancer (23.3%), hematological malignancies (22.2%), and lung cancer (12.4%). The reimbursed G-CSF was pegfilgrastim in 34.1% of cases, lenograstim in 26.7%, and filgrastim in 17.9%. More than one G-CSF product was reimbursed to 21.3% of patients. The total annual reimbursed health expenses per patient, according to the type of G-CSF, were €27,001, €24,511, and €20,802 for patients treated with filgrastim, lenograstim, and pegfilgrastim, respectively. Ambulatory care accounted for, respectively, 35%, 38%, and 41% of those costs. In patients with breast cancer, ambulatory care cost was €7,915 with filgrastim, €7,750 with lenograstim, and €6,989 with pegfilgrastim, and the respective cost of G-CSF was €1,733, €1,559, and €3,668.

Conclusion: All available G-CSF products have been shown to be effective in cancer patients, and both daily G-CSFs and pegylated G-CSF are recommended in international guidelines. Nevertheless, this analysis of G-CSF reimbursement indicates that the choice of product can markedly affect the total cost of ambulatory care.     

Comparing tests of the theory of exhaustible resources

The empirical relevance of Hotelling’s exhaustible resource theory has been tested with primarily negative results. Tests have been performed on various resources, at different levels of aggregation, with varying market structures, and over different time periods. Consequently, it is difficult to draw any general conclusions concerning the theory’s applicability in explaining producer behavior, given the assumptions and restrictions implicit in the data and tests. This paper compares test results when the implicit restrictions associated with the data are removed. Employing a single data set we compare the results for four published tests. Even with this uniform data set, two approaches reject the theory while two do not.