A Note on the High–quality Advantage in Vertical Differentiation Models

It is well established in vertical product differentiation models that the high–quality firm reaps a larger profit in a two–stage quality–price game as long as the cost of quality improvement is zero or is borne as fixed cost in the first stage quality choice. This note shows that the high–quality advantage may fail to hold if there is variable cost of production that is dependent on quality.     

The Determinants of Cereal Grain Imports: Sub‐Saharan Africa, 1970–1997

Abstract: During the 1970s cereal imports in sub‐Saharan Africa increased at an annual rate in excess of 20 percent. As a result, it was assumed Africa had two choices: reduce the rate of population growth or become increasingly dependent on food imports and aid. In this paper we investigate the relative importance of food shortfalls versus policy choices that resulted in a taste change away from roots and tubers and coarse grains to imported wheat and rice. Of the 41 countries studied, 17 are still net exporters of food commodities, cereal imports serve to supplement inadequate production of food, but these imports, generally, are not driven by severe nutritional needs within any one country. Rather, the observed cereal imports are primarily wheat and rice flowing into the countries with adequate levels of nutrition available.     

Belief-value structures as determinants of consumer behaviour: A study of housing preferences and choices

The role of consumers' belief-value structures was investigated in the context of residential preferences and simulated residential choices by means of a questionnaire answered by 36 adult Swedish respondents. Three models with different assumptions concerning how beliefs about the attainment of life values affect consumer behaviour were used for predicting preferences for and choices among hypothetical housing alternatives. A model assuming that the evaluation of a given alternative is determined by a weighted sum of the evaluations of the life values which it is believed to lead to, without specifying how individual attributes contribute to this value-fulfillment, was found to be the most successful one in predicting both preference ratings and choices. The results further suggested that whereas the age of the respondents and the format of the information about attributes may have an effect on belief-value structures, the ability to use such structures in order to predict preferences and choices may not be much affected by these factors. The present approach was compared with the laddering technique, and it was suggested that the two methods may be fruitfully combined in the study of consumer attitudes and behaviour.     

News effects in a high-frequency model of the sterling-dollar exchange rate

This paper uses an extremely high frequency data set on the dollar-sterllng exchange rate to investigate the impact of news events on the very short-term movements in exchange rates. The data set is a continuous record of the quoted price for the exchange rate on the Reuters screen. As such it records some 130,000 observations over an 8-week period. The paper investigates the time-series properties of the data using orthodox regression models, and then by making allowance for a time-varying conditional variance. The conclusions vary significantly in moving to this more sophisticated model. The exercises are repeated now incorporating news announcement effects, letting these affect the level of the exchange rate and then the conditional variance process. Again it is found that the conclusions are radically altered in moving to the increasingly sophisticated model.     

An empirical investigation of immigrant effects: the experience of firms operating in the emerging markets

The immigrant effect consists of the ‘employer’ and the ‘employee’ effect. This study focuses on the ‘employee’ effect. Existing studies on the immigrant effect have identified its contributions to international trade and international marketing management but have not explained under what circumstances this effect can be used to achieve a firm's objectives when operating in a foreign market. This study explores the profile of the firms which have used this effect to assist their operations in three foreign host markets (China, Hong Kong and Taiwan). Based on the outcomes of a multivariate logistic regression analysis, this study has generated a number of useful findings. Firm size is not suggested as a factor for the selection of immigrant effects. Firms are more likely to adopt an immigrant effect when their products are new to the markets. FDI mode users tend to be more likely to use the immigrant effect. Usage of immigrant effects is also found to be associated with firms from a smaller domestic economy. The immigrant effect is often used to break cultural barriers between home and host markets, but is more helpful when the marketing infrastructure in the home and host markets is similar. The choice of immigrant effect is suggested to have no influence on firms' performance in the host markets.