Further evidence on breaking trend functions in macroeconomic variables

This study first reexamines the findings of Perron (1989) regarding the claim that most macroeconomic time series are best construed as stationary fluctuations around a deterministic trend function if allowance is made for the possibility of a shift in the intercept of the trend function in 1929 (a crash) and a shift in slope in 1973 (a slowdown in growth). Unlike that previous study, the date of possible change is not fixed a priori but is considered as unknown. We consider various methods to select the break points and the asymptotic and finite sample distributions of the corresponding statistics. A detailed discussion about the choice of the truncation lag parameter in the autoregression and of its effect on the critical values is also included. Most of the rejections reported in Perron (1989) are confirmed using this approach. Secondly, this paper investigates an international data set of post-war quarterly real GNP (or GDP) series for the G-7 countries. Our results are compared and contrasted to those of Banerjee et al. (1992) and Zivot and Andrews (1992). In contrast to the theoretical results contained in these papers, we derive the limiting distribution of the sequential test without trimming.     

Consumption Externalities and Diffusion in Pharmaceutical Markets: Antiulcer Drugs

We examine the role of consumption externalities in the demand for pharmaceuticals at both the brand level and over a therapeutic class of drugs. Externalities emerge when use of a drug by others affects its value, and/or conveys information about efficacy and safety to patients and physicians. This can affect the rate of market diffusion for a new entrant, and can lead to dominance of one drug despite the availability of close substitutes. We use data for H₂-antagonist antiulcer drugs to estimate a dynamic demand model and quantify these effects. The model has three components: an hedonic price equation that measures how the aggregate usage of a drug, as well as conventional attributes, affect brand valuation; equations relating equilibrium market shares to quality-adjusted prices and marketing levels; and diffusion equations describing the dynamic adjustment process. We find that consumption externalities influence both valuations and rates of diffusion, and that they operate at the brand and not the therapeutic class level.     

Communicating greener strategies: a study of on-pack communication

Developing and implementing successful green strategies depends upon good communication. Faced with an increasingly cynical public, companies are finding it difficult to communicate improvements in their eco-performance to the marketplace in a way that will enable them to generate a competitive advantage. This difficulty is compounded by the problems involved in using traditional communications media for a task to which they are often poorly suited. Advertising for example, is difficult to formulate around green issues which are complex and hard to put across within the sort of short, style-orientated information bite that characterises many contemporary campaigns. Companies are looking for alternatives, and for packaged goods manufacturers are using the product's package as a communications channel. It reaches all existing (if not all potential) customers, and on-pack information is typically seen by consumers as relatively credible. This paper provides an exploratory study of on-pack information in part of the environmental ‘front-line’; the anti-perspirant and deodorant (APD) market. Options for on-pack communication are examined along with some of the issues that arise from trying to engage in environmental communication with the customer using packaging as the medium. © 1997 John Wiley & Sons, Ltd and ERP Environment.     

Book Reviews: Recensions de livres

Les entreprises de services Jean Nollet et John Haywood-Farmer Réussir la qualitéde service Marcel Alain. Laval Marketing de services, le défi relationnel Michel Langlois et Gérard Tocquer. Organizational Behaviour: A Canadian Perspective Hugh J. Arnold, Daniel C. Feldman, and Gerry Hunt Organizational Behaviour: Understanding Life at Work (3rd edition) Gary Johns. Managing Organizational Behaviour (1st Canadian edition) John R. Schermerhorn, Jr., Andrew J. Templer, R. Julian Cattaneo, James G. Hunt, and Richard N. Osborn.     

Ageing,retirement and pension reforms

The gist of this paper is that the financial problems of pensions arise not only from the ageing of the population but also from the progressive reduction of the retirement age. It shows that social security systems explain in part such a reduction and indicates why reforms encounter so many political obstacles even though they would benefit most retirees, particularly those with few resources.     

Can People Explain Their Own Vote? Introspective Questions as Indicators of Salience in the 1995 Quebec Referendum on Sovereignty

Most scholars doubt that voters are able to explain their own vote. We argue that introspective questions whereby respondents are invited to tell, in their own words, the reasons why they vote the way they do, provide useful information on which considerations are most salient in their voting decisions. We show that open-ended questions about reasons for voting Yes or No in the 1995 Quebec referendum on sovereignty help us to sort out subgroups of voters for whom a given consideration is more salient.     

Measuring market power in the French Comte cheese market

A new empirical industrial organisation approach is used tomeasure seller market power in the French Comté cheesemarket, characterised by government-approved supply control.The estimation is performed on quarterly data at the wholesalestage over the period 1985–2005. Three different elasticityshifters are included in the demand specification, and the supplyequation accounts for the existence of the European dairy quotapolicy. The market power estimate is small and statisticallyinsignificant. Monopoly is clearly rejected. Results appearto be robust to the choice of functional form and suggest littleeffect of the supply control scheme on consumer prices.     

Cost and Production Duality: The Case of the Regulated Firm

This paper examines a generalization of cost-production duality for regulated firms. It derives an equivalency between the production function and conditional factor demands for the case where the firm's optimization problem is subject to a set of additional (regulatory) constraints. This procedure is extended to an optimization problem within a dynamic framework which leads to the recovery of the firm's technology.