TV advertising spillovers and demand for private labels: the case of carbonated soft drinks

The expansion of private labels, or store brands, has transformed consumer choice sets and competition in retail markets, prompting manufacturers to fight back with renewed pricing and product and promotion strategies to forestall further private label expansion. This article examines the spillover effects of television advertising on brand-level consumer demand for carbonated soft drinks (CSDs), including private labels, using a random coefficients logit model with household purchasing and advertising viewing Nielsen data. As in previous work, we find that although brand spillover effects significantly increase demand for CSD brands in the same company and undermine demand facing other manufacturers’ CSD brands, surprisingly, there are positive spillover effects on the demand for private label brands. This indicates that brand advertising is persuasive with respect to manufacturers’ brands but complementary with respect to private labels. Further results show that eliminating television advertising for CSDs would lower aggregate CSD sales as consumers migrate to other beverages, although private labels stand to gain, particularly Wal-Mart brands.     

The role of domestic demand in the economic growth of Malaysia: a cointegration analysis

For the past four decades (1961-2000), the Malaysian economy grew at an impressive average rate of 6.8% per annum. The rapid growth has been attributed, in part, to the tremendous success in the export-oriented industrialization policy. Several empirical studies on export-led growth for Malaysia have, however, led to inconclusive and mixed results. This may be due to the exclusion of domestic demand in the bivariate or multivariate models used in the studies. This study re-examines the role of domestic demand in economic growth in Malaysia. Using a three-variable cointegration analysis, the study shows that there exist short run bilateral causalities among the three variables, which implies that both the export-led growth and domestic demand-generated growth hypotheses are at least valid in the short run. On the other hand, the results are not supportive of the export-led growth hypothesis in the long run. Instead, the highly significant positive impact of domestic expenditure on economic growth implies that use of domestic demand as the catalyst for growth is appropriate.     

The Stability of the Demand for Money in Monetary Unions: Some Empirical Evidence from WAEMU

Previous studies of the stability of the demand for money have been largely conducted in the context of individual countries. To the extent that these countries have control over their monetary policies, such an approach is well justified. However, for monetary unions, where the control over monetary policy is usually vested in a central or outside authority, it is more appropriate to examine the stability of the money demand for the union as a collective entity. This paper follows this approach with respect to a West African monetary union, the WAEMU, whose monetary policies are largely dictated by the French authorities. Using cointegration theory and CUSUM stability tests, we find evidence that the demand for broad money is stable in this union. Given the empirical results, the paper draws inferences regarding their implications for the formulation of optimal monetary policy for the WAEMU.     

Oil-Price Shocks: Beyond Standard Aggregate Demand/Aggregate Supply Analysis

The author explores the problems of portraying oil-price shocks using the aggregate demand/aggregate supply model. Although oil-price shocks are the most commonly cited examples of aggregate supply shocks, they violate the model's assumption of constant relative prices (as acknowledged by the label, “oil-price shocks”). The resulting problems are effectively masked in textbook presentations by implicitly assuming that the supply shocks occur in a closed economy. However, the typical discussion is glaringly inaccurate when discussing the effects of oil-price shocks on oil-rich countries. Thus, the cogency of the standard model's representation of oil-price shocks on open economies is compromised. A simple modification of the model that differentiates between production and absorption goods enables it to better reflect the effects of oil-price shocks on open economies.     

Comment

How well does competitive theory explain the outcome in experimental markets. The authors examined the results of a large number of classroom trading experiments that used a pit-trading design found in Experiments with Economic Principles, an introductory economics textbook by Bergstrom and Miller. They compared experimental outcomes with predictions of competitive-equilibrium theory and with those of a simple profit-splitting theory. Neither theory was entirely successful in explaining the data, although in the first rounds of trading there was significant profit splitting and, as traders became more experienced, outcomes were closer to those predicted by competitive theory.     

Rejoinder to Peltzman

Since 2008, the U.S. economy has been mired in the second worst economic crisis in its history. Conceivably, massive government spending could bring the economy out of this slump as massive war spending ultimately ended the Great Depression of the 1930s. However, a far superior strategy exists: guaranteeing employment accompanied by retraining to enable all unemployed workers to become absorbed into the regular work force. Beyond ending the crisis, the superiority of this strategy is that it would institutionalize a procedure for insuring that, in an increasingly technologically dynamic and open economy, workers would possess the necessary skills for available jobs. Guaranteeing employment would also eliminate the ecological costs associated with the need to seek growth to generate employment at practically any cost. Finally, it would establish a new moral social contract, whereby everyone is granted the dignity that accompanies being a productive member of society. Welfare for those able to work could disappear, along with the degradation and humiliation accompanying it.     

总需求、国际贸易与我国省际生产率变化——基于省际面板数据的研究

全要素生产率的提高是促进经济持续增长的重要原因,对生产率的研究,主要是从供给方面展开的,本文试图从需求角度研究全要素生产率变动的原因。理论上看,总需求通过影响技术创新、技术选择、规模经济效益和要素的使用效率等途径引起生产率的变化,国际贸易则通过促进分工深化、产生技术溢出等促进生产率的提高。然后,本文采用数据包络分析方法测算了中国省际全要素生产率变化,并将其分解为技术效率的变化和技术进步。结果发现中国改革开放以来全要素生产率增长主要是技术进步的结果,技术效率的作用很小。在测算和分解的基础上,利用省际面板数据,就总需求和国际贸易对生产率增长的影响作了实证分析,发现最终消费和资本形成对技术进步和全要素生产率的提高作用显著,出口对生产率增长的作用不显著,进口显著地促进了省际全要素生产率增长和技术进步。     

Teaching Third-Degree Price Discrimination

Abstract: Third-degree price discrimination is taught in almost every intermediate microeconomics class. The theory, geometry, and the algebra behind the concept are simple, and the phenomenon is commonly associated with the sale of many of the goods and services used frequently by students. Classroom discussion is usually vibrant as students can relate their experiences of being on the receiving end of third-degree price discrimination, usually to their advantage. However, the precision of the language used in the exposition of the theory in textbooks is generally less precise than one would hope for, leading students to confuse slope and elasticity. The authors ask textbook writers to provide greater precision in their explanation of why differing elasticities are associated with the prices paid by two (or more) distinct groups of buyers facing third-degree price discrimination.     

住房公积金导致了不平等吗——来自中国家庭金融调查的证据

住房公积金制度作为一项政策性住房金融制度,能够缓解家庭购房金融约束、稳定住房金融市场,成为实现"房住不炒"的重要政策工具。本文以2015年实施的住房公积金信贷宽松政策作为外生冲击,从财富效应的角度研究了住房公积金制度对不同家庭购房行为的影响。利用双重差分的实证研究方法,本文发现目前住房公积金主要促进了缴存家庭的多套房需求,加大了缴存家庭与非缴存家庭的住房财富差距。住房信贷政策的针对性与多样性急需提升。     

宏观经济稳定政策的理论依据

宏观经济稳定政策虽然是现代各国政府常用的稳定经济运行的工具,但稳定政策的理论争论从来没有间断过。对不同经济学流派的政策主张及其理论依据的回顾并分析表明,凯恩斯主义的需求管理政策仍是我国前几年实施的积极财政政策的理论基础。