Addressing Negative Willingness to Pay in Dichotomous Choice Contingent Valuation

This paper has four purposes. First, we outline the controversy surroundingthe issue of negative willingness to pay (WTP)in contingent valuation (CV) studies. Second,we use Monte Carlo simulation to examine theperformance of alternative distributionalassumptions in estimating WTP in the presenceof varying proportions of the populationholding negative WTP values. We focus ondichotomous choice CV (DC-CV), where negativeWTP values may be especially difficult todetect. Third, we extend the simulation toinvestigate the performance of the mixturemodels that have recently been proposed forhandling/identifying non-positive WTP values. Fourth, we extend the simulation to investigatethe performance of the nonparametric lowerbound Turnbull approach. Results indicate thatthe relative performance of the DC-CV modelingalternatives evaluated here, which assumepositive WTP, varies across the simulationsetting (e.g., proportion of negative WTP); butnone can be said to reasonably ``solve' theproblem ex post. This underscores theimportance of ex ante efforts to identify ifnegative WTP is likely to be prominent in agiven valuation setting. In such cases,appropriately handling negative WTP must beaddressed through ex ante survey design andmodeling choices that allow negative WTP.     

Perceptions of Industrial Design: The “Means” and the “Ends”

It is widely accepted that industrial design can play an important role in the development of innovative products, but integrating design‐thinking into new product development (NPD) is a challenge. This is because industrial designers have very different perspectives and goals than the other members of the NPD team, and this can lead to tensions. It has been postulated that the communications between NPD managers and industrial designers are made more difficult because each group uses very different language. This research made the first empirical investigation of the language used by designers and managers in describing “good” and “poor” industrial design. In‐depth interviews were conducted with a sample of 19 managers and industrial designers at five leading companies. Multiple sources of data were utilized, including the repertory grid technique to elicit the key attributes of design, from the perspective of managers and designers. Using a robust, systematic coding approach to maximize the validity and reliability of qualitative data analysis, it was established that managers and industrial designers do not use a completely different vocabulary as previously supposed. Rather, it was found that managers and industrial designers use some common terms augmented by additional terms that are specific to each group: managers are commercially orientated in the “ends” they want to achieve and designers perceive more antecedents (“means”) necessary to achieve their “ends”—iconic design. This research led to a grounded conceptual model of the role of design, as perceived by managers and industrial designers. The implications of the results achieved are wide: they indicate how managers and designers can interact more productively during NPD; they highlight the need for more research on the language of designers and managers; and they point to issues that need to be covered in the education of industrial designers. Finally, this work suggests how managers and designers can engage in a more fruitful dialogue that will help to make NPD more productive.     

Trade associations as corporate social responsibility actors: an institutional theory analysis of animal welfare in tourism

Most travel trade associations ignore their responsibility towards sustainable development broadly and animal welfare in particular. We analyse the development and implementation of animal welfare standards across 62 national and international associations using interviews, surveys, content analysis of published materials and websites. Only 21 associations mention sustainability in their websites, and only six refer to animal welfare. Of these, three associations have well-developed animal welfare activities (ABTA, ANVR and GSTC) [AQ1] and only one (lightly) monitors its members’ sustainability and animal welfare standards (ANVR). ABTA’s Animal Welfare Guidelines are the de facto industry standard, despite being designed for information (not auditing) purposes and lacking enforcement mechanisms. We examine jolts that prompt some associations to respond to external pressures and the institutional entrepreneurship process that triggers a process of reflexivity, theorisation and diffusion of a broader sense of responsibility. We examine the field-level conditions that lead to mostly mimetic pressures on large European tour operators (that compel them to act due to reputational risk management), with minimal normative pressures that would diffuse animal welfare practices across other association members. Change is not divergent, and the resources allocated to animal welfare protect trade associations’ members from criticism without binding them to implementation.     

Isolating the Information Content of Equity Analysts' Recommendation Changes,Post Reg FD

We investigate the information content of equity analysts' recommendation changes subsequent to the passage of Regulation Fair Disclosure. We find that analyst upgrades (downgrades) are associated with positive (negative) abnormal returns. Overall, stock prices tend to react significantly more strongly to recommendation changes accompanied by news events than to those that are not. Even so, returns around recommendation changes not accompanied by news are significantly different from zero. This result holds after controlling for firm‐specific variables and the incidence of multiple simultaneous recommendation changes. We conclude that analyst recommendation changes, in and of themselves, are informative.     

Assessing the impact of unilateral trade policies EBA and AGOA on African beneficiaries' exports using matching econometrics

The existing literature studying the impact of non‐reciprocal preferential trade agreements (NRPTAs) assumes implicitly NRPTAs are non‐randomly assigned without showing the evidence of that. Using a matching methodology, this paper investigates whether the “African Growth and Opportunity Act” (AGOA) and the “Everything But Arms” (EBA) unilateral trade concessions have had an impact, and in what magnitude, on the exports of African beneficiary countries in the light of the evidence of the non‐random nature (endogeneity) of NRPTAs. Methodologically, previous studies using the matching procedure focused on bi or multilateral trade agreements. Our work focuses on NRPTAs that depend only on donors' conditions. Accordingly, we show that for NRPTAs, gravity covariates cannot be used for the matching procedure. We propose to use political variables as determinants for obtaining non‐reciprocal trade preferences in order to address the endogenous nature of NRPTA assignment. Our main results confirm that a country becomes eligible for a NRPTA only when it meets certain conditions, defined by their donors, such as political stability and economic regulation (for AGOA), and freedom of expression and human development (for EBA). Results also show that both AGOA and EBA policies have had a positive impact on African beneficiary countries' exports to NRPTA's providers, even if the magnitude impact of EBA is significantly lower than that of AGOA.     

EVOLVING A THEORY OF PERFORMANCE‐BASED LOGISTICS USING INSIGHTS FROM SERVICE DOMINANT LOGIC

Performance‐based logistics (PBL) represents a strategy for sustaining complex systems following production. Despite several implementations, limited understanding exists regarding PBL and its implications. Research using grounded theory emerged a theoretical framework for PBL. Service dominant logic (SDL) is introduced as a theoretical lens for interpreting the results and understanding how trading partners achieve performance‐based outcomes.     

The Precursor Role of Cooperation,Coordination, and Relationship Assets in a Relationship Model

ABSTRACT

Purpose: The primary purpose of this study is to test the importance of activity-oriented precursors in a relationship model. This study supports the theoretical view that firms create trust and knowledge through activities and these activities make a commitment decision less risky (Johanson & Vahlne, 2009). The secondary purpose of this study is to collect and examine data from interorganizational relationships in both Sweden and the United States. By including data from two countries, results will be more generalizable. Results can also lead to several managerial implications.

Methodology/approach: This study focuses on a sample of distributors from both the United States and Sweden. One hundred sixty-one usable surveys were returned from the U.S. survey, for a response rate of 27%. One hundred twenty-four usable surveys were returned from the Swedish survey, for a response rate of 21%. The PLS-SEM method was used to examine the model’s constructs.

Findings: Similar to past research results show that trust and commitment have a direct positive influence on satisfaction, and that trust also has a direct positive influence on commitment. However, this study uniquely supports four out of six newly tested hypotheses. Both cooperation and relationship assets have a direct positive influence on commitment. Cooperation has a direct positive influence on trust and commitment. Relationship assets have a direct negative influence on trust but a direct positive influence on commitment. Surprisingly, two hypotheses were not supported: Coordination did not have a significant relationship with either trust or commitment.

Research implications: Managers who want to achieve a satisfactory relationship based on trust and commitment need to prioritize their attention toward cooperation. They should also be aware that participation in joint activities (i.e., coordination and relationship investments) does not guarantee higher levels of trust or commitment in the relationship. It is the quality of the joint activities and the how dependent firms are on each other and not just participation in joint activities that are likely to create higher levels of trust or commitment. The quality of coordination and manageable levels of dependence may counteract the higher costs associated with joint activities compared to the costs associated with cooperation. Managers may be wise to not make major commitments to other firms unless high quality joint activities have created knowledge and trust between firms. Originality/value/contribution: The model adds the joint activity-oriented antecedents associated with collaboration which is essential to a successful relationship. Because of the high failure rate of collaboration may be due to cooperation and coordination failures and because these two constructs are underspecified in interorganizational research, this study is unique in examining activity-oriented antecedents in a trust/commitment model of relationship satisfaction in a cross-cultural context (i.e., with U.S. and Swedish samples).     

Managing Customer Knowledge During the Concept Development Stage of the New Food Product Development Process

New product development (NPD) is a knowledge-intensive process where the generation of new ideas and concepts requires detailed knowledge of both products and customers. The high reported failure rates for innovative functional beverages suggest an inability to manage customer knowledge effectively as well as a lack of knowledge management between functional disciplines involved in the NPD process. This research explored the concept of managing customer knowledge at the early stages of the NPD process, through the use of advanced concept optimization methods, and applied it to the development of a range of functional beverages. A conjoint-based survey was administered to 400 customers in Ireland. This research identified 2 hypothetical functional beverage concepts with high levels of customer acceptance. Managing customer knowledge during the concept development stage of the NPD process can assist firms overcome customer acceptance issues associated with innovative products. Methodologies that advance both a firm's understanding of customers' choice motives and value systems can increase the chances of new product success in international food and beverage markets.     

An Open Source Web-Mapping System for Tourism Planning and Marketing

Core retail management functions include defining market areas and profiling customers. For tourism enterprises, market areas are geographically dispersed with many customers residing beyond the immediate area surrounding the attraction. Visualization and analysis of these distributed market areas are significantly enhanced by the capabilities of Geographic Information System (GIS) technology and help to support management objectives. Unfortunately, many businesses are unable to utilize GIS due to its complexity and expense. This study develops a decision support tool for tourism planning and marketing that is customized and easy to use, employs open source software to reduce expense, and allows for broad accessibility via web delivery. Users can easily visualize and examine the spatial distribution of their own United States (US) client origins and visitation patterns along with relevant tourism-specific and general demographic information. This functionality can be beneficial in developing or augmenting business plans or marketing strategies, and for informing tourism theory.     

Making Reservations Online: The Impact of Consumer-Written and System-Aggregated User-Generated Content (UGC) in Travel Booking Websites on Consumers’ Behavioral Intentions

This study examines how consumer-written and system-aggregated user-generated content (UGC) on travel booking websites jointly influence consumer behavior. The purpose of this research is to test the effects of different types of UGC on various consumer behavior outcomes. Experiment 1 found a significant interaction effect between UGC type (consumer-written versus system-aggregated) and valence (positive versus negative) on product evaluation, perceived information value, and satisfaction. Experiment 2 found a significant interaction between consumer-written and system-aggregated UGC valences. When consumer-written UGC was negative, consumers demonstrated more negative product evaluation and lower buying intention, regardless of system-aggregated UGC valence. When consumer-written and system-aggregated UGC valences matched, consumers indicated greater perceived information value, satisfaction, and future behavioral intention. Trustworthiness partially mediated the effect of the fit between consumer-written and system-aggregated UGC on consumer satisfaction.