nep-mkt New Economics Papers
on Marketing
Issue of 2007‒03‒31
five papers chosen by
Joao Carlos Correia Leitao
University of the Beira Interior

  1. Consumer Demand for Quality: Major Determinant for Agricultural and Food Trade in the Future? By Julie A. Caswell; Siny Joseph
  2. Racial and Ethnic Discrimination in Local Consumer Markets: Exploiting the Army’s Procedures for Matching Personnel to Duty Locations By Deborah A. Cobb Clark; Heather Antecol
  3. Price setting in the euro area: some stylised facts from individual producer price data. By Erwan Gautier; Ignacio Hernando; Philip Vermeulen; Daniel Dias; Maarten Dossche; Roberto Sabbatini; Harald Stahl
  4. Does Globalization Create Superstars? By Gersbach, Hans; Schmutzler, Armin
  5. Information Technology and the Ambidexterity Hypotheses: An Analysis in Product Development By ELENA REVILLA

  1. By: Julie A. Caswell (Department of Resource Economics, University of Massachusetts Amherst); Siny Joseph (Department of Resource Economics, University of Massachusetts Amherst)
    Abstract: The impact of consumer demand for quality on the agricultural and food system is an increased emphasis on quality differentiation but not all in the direction of upgrading quality. The more elite market segments are thriving and reaching growing numbers of consumers but the basic price/quality markets remain strong. Most recent economic studies find that consumers are willing to pay for food safety and other quality attributes, and for information about them. The magnitude of the valuations varies by food product, attribute, country, and study design. This literature and a case study of genetically modified foods suggest that consumer demand has a strong effect on agricultural and food trade.
    Keywords: food quality, food safety, consumer demand, willingness to pay, international trade
    JEL: D12 L15 Q18
  2. By: Deborah A. Cobb Clark; Heather Antecol
    Abstract: We use the exogenous assignment of Army personnel to duty locations to analyze the relationship between the characteristics of local markets and the propensity for consumers to be subjected to racial discrimination in their everyday commercial transactions. Overall, one in ten soldiers report that they or their families have experienced racial discrimination in finding non-government housing or in patronizing businesses in their local communities. Discrimination is related to a community’s demographic profile with white and Asian soldiers feeling more unwelcome in local businesses as the local population becomes heavily weighted towards other groups. Moreover, there is evidence that increased economic vulnerability in the community results in more housing discrimination amongst minorities. While the evidence that increased competition reduces consumer market discrimination is mixed, it is clear that discrimination is related to the nature of a soldier’s interaction with the local community.
    Keywords: Consumer Markets, discrimination, U.S. Military, Economics of Minorities
    JEL: J15 D12 D40
    Date: 2006–12
  3. By: Erwan Gautier (Banque de France, 39, rue Croix-des-Petits-Champs, F-75049 Paris Cedex 01.); Ignacio Hernando (Banco de España, Alcalá 50, E-28014 Madrid, España.); Philip Vermeulen (European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany.); Daniel Dias (Banco de Portugal, 148, rua do Comerico, 1150 Lisbon, Portugal.); Maarten Dossche (National Bank of Belgium, Boulevard de Berlaimont 14, B-1000 Brussels, Belgium.); Roberto Sabbatini (Banca dÍtalia – Research Department, Via Nazionale 91, 00184 Roma, Italy.); Harald Stahl (Deutsche Bundesbank, Economics Department, Wilhelm-Epstein-Strasse 14, D-60431 Frankfurt am Main, Germany.)
    Abstract: This paper documents producer price setting in 6 countries of the euro area: Germany, France, Italy, Spain, Belgium and Portugal. It collects evidence from available studies on each of those countries and also provides new evidence. These studies use monthly producer price data. The following five stylised facts emerge consistently across countries. First, producer prices change infrequently: each month around 21% of prices change. Second, there is substantial cross-sector heterogeneity in the frequency of price changes: prices change very often in the energy sector, less often in food and intermediate goods and least often in non-durable nonfood and durable goods. Third, countries have a similar ranking of industries in terms of frequency of price changes. Fourth, there is no evidence of downward nominal rigidity: price changes are for about 45% decreases and 55% increases. Fifth, price changes are sizeable compared to the inflation rate. The paper also examines the factors driving producer price changes. It finds that costs structure, competition, seasonality, inflation and attractive pricing all play a role in driving producer price changes. In addition producer prices tend to be more flexible than consumer prices. JEL Classification: E31, D40, C25
    Keywords: Price-setting, producer prices
    Date: 2007–02
  4. By: Gersbach, Hans; Schmutzler, Armin
    Abstract: To examine the impact of globalization on managerial compensation, we consider a matching model where a number of firms compete both in the product market and in the managerial market. We show that globalization, that is, the simultaneous integration of product markets and managerial pools, leads to an increase in the heterogeneity of managerial salaries. Typically, while the most able managers obtain a wage increase, less able managers are faced with a reduction in wages. Hence our model can explain the increasing heterogeneity of CEO compensation that has been observed in the last few decades.
    Keywords: Globalization; Manager Remuneration; Superstars
    JEL: D43 F15 J31 L13
    Date: 2007–03
  5. By: ELENA REVILLA (Instituto de Empresa)
    Abstract: We investigated ambidexterity, defined as the capacity to simultaneously achieve exploration and exploitation activities at a product development level. Building on the knowledge management literature, we argue that information technology -defined by a combination of the convergent and divergent dimension- facilitate ambidexterity. Further, ambidexterity mediates the relationship between IT and performance. We found strong evidence that ambidexterity mediates the relationship between the IT that encourage these activities and subsequent performance in product development. Data collected from 80 product developments supported our hypotheses.
    Keywords: Information technology, Ambidexterity, Product development , Performance Knowledge Management
    Date: 2007–03

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