Pricing of related products by a multiproduct monopolist

This paper examines the pricing behavior of a multiproduct monopolist (MPM). For a firm selling two products, the profit maximizing price of a particular item is found to depend upon its marginal cost, the own and cross-price elasticities and the budget shares of both products. Conditions are identified under which the price charged by a MPM will be greater than, less than, and equal to the price charged by an otherwise identical single product monopolist as well as the circumstances under which it is profitable for a MPM to utilize one product as a loss leader.     

Personal value systems of Japanese trainees and managers in a changing competitive system

A study of personal values held by Japanese and foreign students, trainees and managers showed recent Japanese trainees slightly more conservative than their 1979 cohorts. Foreign students and foreign managers held more pro-American work values than either Japanese managers or trainees. Finally, for the Japanese respondents, there was some evidence of specific shifts away from the Japanese employment system in the areas of thenenko compensation and promotion systems in their organisations.Roy J. Adams is a Professor of Industrial Relations in McMaster University; Richard B. Peterson is a Professor of Management and Organization in the University of Washington; Hermann F. Schwind is an Associate Professor in St. Mary's University.     

The Impact of an increasing share of RES-E on the Conventional Power Market — The Example of Germany

The intermittency of wind power has a decreasing effect on day-ahead spot prices. Data from Germany illustrate this effect and explain the underlying relationships. This short-term price effect leads to an adaptation process in the conventional generation capacity mix. In the long-run, a higher peak load plant share is required to cope with the increasing volatility of the residual demand. The result is an adapted merit-order. This merit-order intersects with an increasingly volatile residual demand curve and leads to a higher price volatility in the power market, which is going to trigger further adaptations. Therefore this article concludes with a list of open research questions, which can be derived from the illustrated relationship. These research questions should be investigated as soon as possible in order to induce the required adaptations in time.     

Bounds for Ratios of Posterior Expectations: Applications in the Collective Risk Model

This paper considers the collective risk model for the insurance claims process. We will adopt a Bayesian point of view, where uncertainty concerning the specification of the prior distribution is a common question. The robust Bayesian approach uses a class of prior distributions which model uncertainty about the prior, instead of a single distribution. Relatively little research has dealt with robustness with respect to ratios of posterior expectations as occurs with the Esscher and Variance premium principles. Appropriate techniques are developed in this paper to solve this problem using the k -contamination class in the collective risk model.     

Trust and economic growth: a robustness analysis

This paper analyses the robustness of results on the relationshipbetween growth and trust previously derived by Knack and Keefer(1997) and Zak and Knack (2001) along several dimensions, acknowledgingthe complexity of the concept of robustness. Our results showthat the Knack and Keefer results are only limitedly robust,whereas the results found by Zak and Knack are highly robustin terms of significance of the estimated coefficients and reasonablyrobust in terms of the estimated effect size. The improvementin robustness is caused by the inclusion of countries with relativelylow scores on trust (most notably, the Philippines and Peru).Overall, our results point at a relatively important role fortrust. However, the answer to the question how large this payoffactually is depends on the set of conditioning variables controlledfor in the regression analysis and—to an even larger extent—onthe underlying sample.     

An analysis of nontraditional activities at U.S. commercial banks

In recent years, commercial banking in the United States has experienced a decline in its traditional business of financing loans by issuing deposits. Simultaneously, banks have become more involved in nontraditional activities that provide financial services and generate fee income. As a result, real aggregate noninterest income has risen relative to income from traditional activities. This paper examines features common to banks that are heavily engaged in nontraditional areas. The empirical analysis suggests that these banks tend to be larger, have smaller net interest margins, have relatively fewer core deposits, and exhibit less risk. These findings have intuitive appeal and conform to conventional wisdom; while larger banks have fewer core deposits and face more competitive interest rate conditions, resulting in narrow spreads from traditional intermediation, they have more diverse sources of revenue and greater access to financial markets, which reduces risk.     

Globalization frustrated: The case of white goods

This paper challenges the common view that mature industries are always ripe for global strategies. Based on data from the European Domestic Appliance industry, this paper shows how changing economic conditions can diminish the value of global strategies. Critical in these shifts were simultaneous rises in demand for variety (that eroded the benefits of scale and continental market share) and decreases in manufacturing scale (that permitted new supply options), which reduced the extent of the strategic market to national dimensions. They added complexity that decreased the profitability of the global players and increased that of national strategies. The fluctuating fortunes of leading firms are shown to have been caused primarily by choices of strategy, not by national factor costs.     

The Evaluation of Risk in Marine Capital Investments

Future costs and revenues in capital investment opportunities can seldom be predicted with certainty. As a result, there is usually some doubt as to the outcome of an investment. The chance that an investment may not prove profitable represents the investor's risk. This paper considers the problems which uncertainty and risk present in the evaluation of capital investments. Several traditional methods of dealing with uncertainty and risk are considered and shown to be deficient. A relatively new evaluation technique, which utilizes probability theory and computer simulation, is then described and its advantages highlighted. It is suggested that this technique will prove valuable in the evaluation of future marine capital investments.     

Growth Management and Land use Controls: The San Francisco Bay Area Experience

Local land use and growth controls have had a substantial negative impact on the San Francisco Bay Area housing market. These regulations have significantly diminished the availability of development opportunities in the region and forced builders to make major changes in the way they do business and costly alterations in their development projects. Both the empirical evidence reviewed and the case studies documented in this paper indicate that building moratoria, growth management systems, and restrictive zoning practices have helped lead to significantly increased house prices in those Bay Area communities in which they are present. The evidence strongly suggests that land use controls as they are currently utilized in the Bay Area provide a poor policy alternative for reconciling important environmental and fiscal considerations with equally important regional and national housing needs.