Short product life cycles: implications for the marketing activities of small high-technology companies*

ABSTRACT Many high-technology products are characterized by a “short” product life cycle (PLC)—a short life on the market, a steep decline stage and the lack of a maturity stage. The paper discusses the implications for marketing activities of this pattern in the case of small high-technology companies. It is shown that the marketing of a short PLC product requires a high level of marketing, managerial ability and sophistication as well as an investment of a large amount of resources. It is pointed out that small high-technology firms are faced with a particularly difficult situation in this case because they lack appropriate resources and marketing sophistication. An understanding of the short PLC problem will help the small companies to conduct a more realistic assessment of the magnitude of the marketing task they face in order to adequately prepare themselves or avoid a commitment to projects which are beyond their abilities.     

A negative report on the ‘near optimality’ of the max-expected-log policy as applied to bounded utilities for long lived programs

Much controversy surrounds the use of the portfolio investment rules induced by maximizing the expected logarithm of terminal wealth (henceforth referred to as the MEL policy). It has been thought that the MEL policy is a good approximation to the optimal investment program when the utility of terminal wealth function is bounded and when the time horizon is long. However, I exhibit a class of bounded utility of terminal wealth functions for which the MEL policy is a very poor approximation to the optimal program. Hence, the wholesale use of the MEL policy as an approximation to the optimal program is unwarranted.     

Social services and telecommunications: Innovation in human services delivery

This article presents an analysis of the current state of adoption of telecommunications technologies by organizations and individuals who work in human services. It examines the barriers to use of innovations and suggests the future course of acceptance for the different technologies. Radio and telephone appear to have the fewest barriers to adoption, and it is likely that as consumers become more accustomed to advanced technologies in their homes, they will be more likely to accept them in the workplace.     

Managed care as a public cost-containment mechanism

This article identifies the impact of managed-care reforms on the utilization of medical services within the military health-services system. The data come from a recent demonstration project that substituted an HMO and PPO for traditional FFS arrangements. Results from a semiparametric model indicate that the generosity of benefits in the HMO increased demand for ambulatory services. Unlike the private-sector experience with managed care, aggressive utilization review did not significantly curtail inpatient stays. These results vitiate the presumed effectiveness of reform strategies that rely on large, geographically diffused managed-care networks to contain public-sector health costs.     

The investment tax credit under monopolistic competition

This paper develops a dynamic model of monopolistic competitionwith finite lives. It investigates the welfare properties ofan investment tax credit (ITC) for both finite and infinitelives. For infinite lives, it shows that, lacking lump-sum taxes,an ITC suffices to attain a second-best solution. For finitelives, the paper considers the intergenerational welfare distributioneffects of an ITC. In the absence of debt policy, the investmenttax credit benefits future generations but may harm most ofthe existing generations. Using debt financing, the policy makercan redistribute the gains in a completely egalitarian fashion.     

Delegated Portfolio Management and Rational Prolonged Mispricing

This paper examines how information becomes reflected in prices when investment decisions are delegated to fund managers whose tenure may be shorter than the time it takes for their private information to become public. We consider a sequence of managers, where each subsequent manager inherits the portfolio of their predecessor. We show that the inherited portfolio distorts the subsequent manager's incentive to trade on long-term information. This allows erroneous past information to persist, causing mispricing similar to a bubble. We investigate the magnitude of the mispricing. In addition, we examine endogenous information quality. In some cases, information quality increases when the manager's expected tenure decreases.     

Two Risks to World Market

eyond our expectations of happy slowdown＇in 2007, we offer our first guess at the global economic picture in 2008, We expect global growth in 2008 to be higher than in 2007, not least due to a possible improvement in the U.S.. Our forecasts also suggest that the trend growth rate is on the rise in many parts of Europe （especially Germany and the UK）, as well as in significant parts of Asia （particularly China and India）, We also see few signs that this strong growth is generating higher inflation.