Prepayment and future cross-buying: an exploratory analysis

Recent research has provided important insights on consumers’ preferences for prepayment mechanisms and on its impact on consumption of a given product or service. However, little is known about how prepayment influences future purchases of goods and services. We consider this question in a contractual setting within the services industry, involving different purchasing decisions over time. Based on a large-scale empirical test, we find that prepay customers make fewer changes to their cross-buying levels (i.e., the number of different services they buy from the company) from one contractual period to another, and that this effect is more salient for the firm's new customers. We propose possible explanatory mechanisms for this effect. For instance, based on mental budgeting theory, we suggest that prepayment customers may set mental budgets and track expenditures against this budget leading them to resist further investments. Alternatively, prepayment customers may be more certain about their consumption behavior leading to fewer changes over time.

     

A multi-criteria analysis framework including environmental and health impacts for evaluating traffic calming measures at the road network level

Recent interests in both vehicle emissions and public health have facilitated the development of more eco-friendly transportation systems. This study developed a multi-criteria evaluation framework to evaluate the effectiveness of traffic calming measures (TCMs) from the various perspectives at the road network level; operational efficiency, traffic safety, environmental and health impacts. The proposed methodology employs four-step sequential simulation experiments, including driving, traffic flow, emissions, and air dispersion simulations. The results obtained from these four simulations are used to evaluate the effectiveness in terms of safety and operational efficiency in addition to environmental and health impacts. A multi-criteria value function based on the weights estimated from the analysis of an analytical hierarchy process (AHP) is applied in the evaluation framework. As an application, chicanes and speed humps widely implemented in Korean school zones were evaluated at the road network level. The proposed simulation-based approach is expected to be effectively used for the decision-making process in selecting better alternatives for TCM.