nep-mkt New Economics Papers
on Marketing
Issue of 2009‒06‒03
eleven papers chosen by
Joao Carlos Correia Leitao
Technical University of Lisbon

  1. Advertising for attention in a consumer search model By Haan, Marco A.; Moraga-Gonzalez, Jose L.
  2. Are Staple Foods Becoming More Expensive for Urban Consumers in n and Southern Africa? Trends in Food Prices, Marketing Margins, and Wage Rates in Kenya, Malawi, Mozambique, and Zambia. By Nicole Mason; T.S. Jayne; Cynthia Donovan; Antony Chapoto
  3. Determinants of Demand for Wine – price sensitivity and perceived quality in a monopoly setting By Dahlström, Tobias; Åsberg, Erik
  4. CHILDREN THOUGHTS ABOUT BRANDS By Ana Côrte-Real; Paulo Lencastre
  5. Nutzung und Wirkung von Video-Content in Online-Jobbörsen: Erkenntnisse einer explorativen Studie By Sven Pagel; Sebastian Goldstein
  6. Leitura Econômica dos Jogos Olímpicos: Financiamento, Organização e Resultados By Marcelo Weishaupt Proni; Lucas Speranza Araujo; Ricardo L. C. Amorim
  7. Price regulation and generic competition in the pharmaceutical market By Dalen, Dag Morten; Habeth, Tonje; Strøm, Steinar
  8. Multi-Product Exporters and Product Turnover Behaviour of New Zealand Exporters By Muge Adalet
  10. Equity Effects of Road Pricing, A Review By David Levinson
  11. Measuring the Quality of Hospital Services Hospital Specific Factors and Individual Evaluations By Hernæs, Kjersti Helene

  1. By: Haan, Marco A. (University of Groningen); Moraga-Gonzalez, Jose L. (University of Groningen)
    Abstract: We model the idea that when consumers search for products, they first visit the firm whose advertising is more salient. The gains a firm derives from being visited early increase in search costs, so equilibrium advertising increases as search costs rise. This may result in lower firm profits when search costs increase. We extend the basic model by allowing for firm heterogeneity in advertising costs. Firms whose advertising is more salient and therefore raise attention more easily charge lower prices in equilibrium and obtain higher profits. As advertising cost asymmetries increase, aggregate profits increase, advertising falls and welfare increases.
    Keywords: Advertising; attention; consumer search; saliency;
    JEL: D83 L13 M37
    Date: 2009–05–03
  2. By: Nicole Mason; T.S. Jayne; Cynthia Donovan; Antony Chapoto
    Abstract: d food and financial crises threaten to undermine the real incomes of an consumers in eastern and southern Africa. This study investigates patterns in staple food prices, wage rates, and marketing margins for urban consumers in Kenya, Malawi, Mozambique, and Zambia between 1993 and 2009. There is high correlation among wage rate series for various government and private sector categories. We find that average formal sector wages rose at a faster rate than retail maize meal and bread prices in urban Kenya and Zambia between the mid-1990s and 2007. Although the 2007/08 food price crisis partially reversed this trend, the quantities of staple foods affordable per daily wage in urban Kenya and Zambia during the 2008/09 marketing season were still roughly double their levels of the mid-1990s. The national minimum wage in Mozambique also grew more rapidly than rice and wheat flour prices in Maputo from the mid-1990s through the 2004/05 and 2006/07 marketing seasons, respectively. During the 2008/09 marketing season, Maputo minimum wage earners’ rice and wheat flour purchasing power was still higher than in the mid-1990s and roughly similar to levels at the millennium. These findings obtain for formal sector wage earners in Kenya and Zambia and minimum wage earners in Mozambique only. The majority of the urban labor force in these countries is employed in the informal sector; therefore, the general conclusion of improved food purchasing power over the past 15 years may not hold for a significant portion of urban workers. Maize marketing margins trended downward between 1994 and 2004 in urban Kenya, Malawi, and Zambia, while wheat marketing margins declined only in Kenya and Zambia. For the public sector, important strategies for keeping food prices at tolerable levels include strengthening and improving crop forecasting and the food balance sheet approach for estimating need for imports, facilitating imports in a timely manner when needed, and ensuring the continued availability of low- cost staple food options for urban consumers through small-scale processing and marketing channels.
    Keywords: agriculture, africa, food, price
    JEL: Q11
    Date: 2009–06
  3. By: Dahlström, Tobias (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Åsberg, Erik (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: The purpose of this paper is to characterise the demand for wine. In contrast to the majority of current research efforts this paper treats wine as a heterogeneous good with a range of inherent characteristics. Each wine included in the study is described by twelve variables including, among others, price, quality, sensory attributes and country of origin. Using unique data that cover 90 percent of all wines sold in Sweden we conclude that consumers do recognise quality in wine, that price elasticity is non-constant and decreasing with price and that consumers put a great deal of weight on the country of origin of the wine.
    Keywords: consumer preferences; wine; quality; price elasticity; heterogeneous goods
    JEL: D12 D42
    Date: 2009–06–04
  4. By: Ana Côrte-Real (Faculdade de Economia e Gestão, Universidade Católica Portuguesa (Porto)); Paulo Lencastre (Faculdade de Economia e Gestão, Universidade Católica Portuguesa (Porto))
    Abstract: The paper explores theoretically and empirically the brand concept among children. Group interviews were conducted to examine the children’s associations to this concept. The data analysis was organized according to a circular frame (the circept frame), which allowed a content analysis based on a sequence of analogical concepts. Children’s answers suggest that the concept of brand is apprehended by children of 6/8 years old, furthermore, that children of this age have skills to separate the brand from the product concept and described it as a source of guarantee, of identification and of promises vehicle.
    Keywords: Brands, children, associations
    Date: 2009–05
  5. By: Sven Pagel (Department of Economics of the Duesseldorf University of Applied Sciences); Sebastian Goldstein (Department of Economics of the Duesseldorf University of Applied Sciences)
    Abstract: in german: Diese Untersuchung von Video-Stellenanzeigen in Online-Jobportalen fokussiert zwei zentrale Aspekte der Bewegtbildkommunikation: einerseits die Nutzung und andererseits die Wirkung von Videos auf Websites. Zu diesem Zweck wurde eine qualitative Blickregistrierungsanalyse mit 20 Studierenden aus drei unterschiedlichen Fachbereichen durchgeführt. Bei diesen Probanden handelt es sich um zehn weibliche und zehn männliche Studierende in Abschlusssemestern. Ihnen wurden Stellenanzeigen der jeweiligen Studienrichtung präsentiert, so dass von einem thematischen Interesse der potenziellen Bewerber ausgegangen werden kann. Zur Identifikation des Nutzungsverhaltens wurde ein idealtypischer Nutzungsprozess von Videos (Wahrnehmung, Verarbeitung und Interaktion) herausgearbeitet. Bei dieser explorativen Studie wurden sowohl Blickdaten mit Hilfe eines benutzerorientierten Testverfahrens als auch Befragungsdaten mit Hilfe eines Fragebogens erhoben. Diese Studie soll somit erste qualitative Erkenntnisse zur Bewegtbild-Nutzung auf Websites im Rahmen der Marketingkommunikation liefern. Um eine möglichst reale Situation zu erzielen, wurden den Probanden echte Online-Jobportale präsentiert. Ein kontrollierter Vergleich einzelner Gestaltungsmerkmale der Websites bzw. der Videos ist somit nicht angestrebt. Es werden wichtige Erkenntnisse u.a. zur hohen Ablehnung von Autostart-Videos generiert. Und Stellenanzeigen mit Bewegtbild erzielen eine systematisch höhere Erinnerung. Des Weiteren werden differenzierte Aussagen zu kognitiven, emotionalen und konativen Wirkungen der Videos in Jobbörsen getroffen. In english: The increasing implementation of moving images on websites and online presentations necessitates specific research regarding aspects of usability and cognitive perceptions. On basis of its intrinsic raison d'être moving images can be differentiated in original and additive videos. In web based media services original videos can be interpreted as their core products. In contrast, additive motion graphics can be defined as on top content which may enrich the existing information portfolio. As motion can be seen as the key activator of the human visual awareness, additive video content can also have a distractive effect on cognition. In addition to the differentiation of motion graphics in original and additive videos, the role of motion graphics in the media and marketing communication will be analyzed. The core focus of this study is to analyse the perception, usage and effects of motion graphics in online career and recruitment portals. Furthermore, a model of the video awareness und interaction process will be developed. 20 students/ applicants from three different departments took part at this eyetracking study. Thus, employed methods are eyetracking studies and accompanying interviews with test persons.
    Keywords: video-content, job-offers, career and recruitment portals, usability, eyetracking
    JEL: C12 M12
    Date: 2009–05
  6. By: Marcelo Weishaupt Proni; Lucas Speranza Araujo; Ricardo L. C. Amorim
    Abstract: Os Jogos Olímpicos são uma combinação impressionante de espetáculo e competição, heroísmo e fatalidade, nacionalismo e globalização cultural. Todavia, há outro lado grandioso, revelado quando se observa o valor econômico dos Jogos Olímpicos. Há uma racionalidade que caminha em paralelo à organização das competições e à disputa de medalhas. São razões de Estado mescladas a interesses privados que, quando bem articulados, convergem para um planejamento rigoroso, capaz de transformar custos elevados em rentáveis dividendos políticos, econômicos e sociais, invisíveis aos olhos desatentos da maioria dos telespectadores. Por isso, o presente estudo se debruça sobre esse outro lado, analisando os planos, a realização e os impactos dos eventos sobre as regiões-sede e os países dos Jogos. Para contribuir neste sentido, o estudo toma três exemplos de edições dos Jogos Olímpicos (Barcelona, Sydney e Beijing) e analisa brevemente os principais aspectos microeconômicos do evento, tais como planejamento, logística, plano de marketing e equilíbrio financeiro. Também procura discutir a face macroeconômica dos impactos resultantes dos jogos, tais como as transformações locais no fluxo de recursos, na infra-estrutura e o surgimento ou o reforço de novas atividades produtivas, como o turismo. Além disso, dá ênfase ao impacto na geração de empregos, na relocalização de empresas e de setores de atividade, assim como à influência exercida sobre a economia da região que hospeda os Jogos.
    Date: 2008–08
  7. By: Dalen, Dag Morten (Handelshøyskolen BI); Habeth, Tonje (Handelshøyskolen BI); Strøm, Steinar (Department of Economics, University of Oslo)
    Abstract: In March 2003 the Norwegian government implemented yardstick based price regulation schemes on a selection of drugs experiencing generic competition. The retail price cap, termed “index price”, on a drug (chemical substance) was set equal to the average of the three lowest producer prices on that drug, plus a fixed wholesale and retail margin. This is supposed to lower barriers of entry for generic drugs and to trigger price competition. Using monthly data over the period 1998-2004 for the 6 drugs (chemical entities) included in the index price system, we estimate a structural model enabling us to examine the impact of the reform on both demand and market power. Our results suggest that the index price helped to increase the market shares of generic drugs and succeeded in triggering price competition.
    Keywords: Discrete choice; demand for pharmaceuticals; monopolistic competition; evaluation of yardstick based price regulation
    JEL: C35 D43 I18 L11
    Date: 2009–06–04
  8. By: Muge Adalet (The Treasury)
    Abstract: Using a unique dataset that covers all exporting firms in New Zealand from 1996 to 2007, this paper analyses the patterns of their product mix, how it changes over time and how this relates to firm characteristics. We suggest that looking at the relative importance of added and dropped products is as important as firm entry/exit in reallocation of resources. We find that in the cross section, multi-product firms are more productive than single product ones. Changes to product mix by New Zealand exporters occur frequently, suggesting that New Zealand exporters are dynamic and there is “creative destruction” at the product level. It is also shown that dropping products is more likely to happen than adding products, suggesting the difficulty of entering new markets and products. We also show that products with a smaller share of total exports and products that have been exported for a short period of time are more likely to be dropped by a firm. The results make a good case for product-firm characteristics being an important part of export decisions and suggest that more work should be done on this link.
    Keywords: Product churning; product market entry and exit; volatility of earnings; multi product firms; creative destruction
    JEL: D21 E23 L11 L60
    Date: 2009
  9. By: Antony Chapoto; T.S. Jayne
    Abstract: events in the 2008/09 season have amply demonstrated, instability in food market remains a major problem in Zambia. A rise in world food price levels and instability, which is projected to occur in the near future according to several international institutes, will make it all more important for developing countries to consider the strengths and weaknesses of alternative approaches for buffering their domestic food systems from potential high volatility in world markets. These findings suggest that promoting more “rules based” approaches to marketing and trade policy may reduce the level of policy uncertainty and the price instability associated with it. Greater policy stability may also contribute to broader grain market development. For the most part, addressing problems of policy uncertainty involve very little cost per se, but do require greater coordination and more efficient management of government operations. However, policy makers may feel that rules-based and non-discretionary marketing and trade policies entails a loss of control and autonomy – leaders are bound to act according to predefined rules and triggers. Successfully addressing these dilemmas may lie at the heart of efforts to move to a new post-liberalization system in which governments retain the ability to influence prices to achieve national food security objectives but within a clear and transparent framework of credible commitment to support long run private investment in the development of markets.
    Keywords: zambia, maize, trade, price
    JEL: Q11
    Date: 2009–06
  10. By: David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota)
    Abstract: Are road pricing strategies regressive or progressive? This is a question that has been confronting researchers, practitioners, and policy-makers who seek to implement new mechanisms to raise funds for transportation while simultaneously managing demand. The theoretical literature is mixed, as is the empirical literature. In part this has to do with the various types of road pricing strategies that are being debated, different definitions of equity, and alternative assumptions about revenue recycling. Despite this seeming complexity, the literature is clear that equity issues are addressable. This paper provides a synthesis of the literature to date on both the theory of equity, as applied to road pricing, and the findings of empirical and simulation studies of the effects of particular implementations of road pricing, and suggested remedies for real or perceived inequities. To summarize, while there are certainly potential issues with equity associated with road pricing, those issues can be addressed with intelligent mechanism design that provides the right incentives to travelers and uses the raised revenues in a way to achieve desired equitable ends. These include cutting other taxes and investing in infrastructure and services.
    JEL: R41 R42 R48 D02 D63
    Date: 2009
  11. By: Hernæs, Kjersti Helene (Frischsentre)
    Abstract: Is an increase in the quality of health services, as perceived by the hospital, appreciated by the consumers? If so, patients should respond positively to an increase in the quality of hospital services. Using two indicators to capture the quality of hospital services I investigate the relationship between these indicators and inpatients’ experiences. The health sector has increased substantially in most OECD countries over the last few decades. In Norway, total health care expenditures as a percentage share of the GDP, has grown from 2.9 % in 1960 to 8.7 % in 2002. In 2002 the state took over ownership of the Norwegian hospital sector and organized it through five regional semiautonomous companies. The motivation behind this was more efficient use of hospital resources, equal access despite geographical differences, and a higher quality of health services. Cost efficiency, measured as total activity relative to total costs, decreased during the 1990s. Part of the decrease can be explained by increased labour costs. It is often assumed that decreasing costs lead to lower quality. If this is the case in the health sector, one would expect to see a higher level of quality when costs per patient increase. Health services are paid for by taxpayers who are also the users of these services. For this reason, and especially since costs have increased, they should be able to evaluate the quality of the services they receive. This leads to an important question: What aspects of quality are important to consumers of health services? Do quality indicators, such as readmission rates and waiting time, capture the quality that consumers demand? This thesis is an attempt to answer these questions. The method I use is standard OLS. I also investigate possible cross-effects between hospitals’ readmission rates and age and look at the effect of a one standard deviation change in four of the explanatory variables. I also consider the use of an alternative estimation method that allows for stronger correlation between patients within hospitals but assumes independence between patients at different hospitals. The estimations are done using the statistical package StataSE 8. Using a simple regression model I have investigated the relationship between patients’ experiences during a hospital admission and the readmission rate and mean waiting time at the hospital they were admitted to. The data on these two hospital specific variables iii were provided by SINTEF Health who runs the Norwegian Patient Register. The register is owned by the Directorate of Health and Social Affairs. The data on patient satisfaction with hospital services were taken from an anonymous survey among patients admitted to somatic hospitals. They received the surveys two to three weeks after discharge. The response rate was approximately 50 %. The questions in the survey concerned issues such as health personnel’s ability to convey and receive relevant information, as well as provide care, treatment, and pain relief. There were also questions on patients’ impression of hospital equipment, general standard, and facilities and sanitary conditions. The survey consisted of 50 questions that I grouped into seven category variables, according to the type of service the different questions concerned. These categories were content, info, info2, facisani, care, org, and improve. Patients were also asked about their gender, age, health status, education level, number of admissions last two years, and whether their first language was Scandinavian. I was thus able to control for these characteristics. My main empirical finding is that hospitals’ readmission rates have a negative and significant effect on inpatients’ experiences. Patients admitted to hospitals with low readmission rates are more content with the care, treatment, and information they receive from hospital personnel. They are also more content with hospital facilities and sanitary conditions and organization of hospital staff. The results for waiting time were more ambiguous. Patients’ impression of hospitals’ facilities and sanitary conditions was better at hospitals with longer waiting time. It may be that other quality aspects are better at these hospitals, and that these other aspects are more important for patient satisfaction. Patients’ age, health status, number of previous admissions, and education level significantly affected their satisfaction with hospital services. The age effect was positive but decreasing. Investigating the cross-effect between age and the readmission rate showed that younger patients respond more negatively to a given readmission rate than older patients. Patient satisfaction decreased with the number of admissions and with patients’ education level but increased with patients’ health status. Patient characteristics explained the main share of the variation in patients’ experiences. Including dummies for hospitals increased the share of variation explained indicating that there are hospital specific factors present that affect patient satisfaction. Of this increase readmissions and waiting time explained a small part. More precise measures of hospital level quality may be needed in order to capture more of this variation.
    Keywords: quality; heslth services; hospitals
    JEL: I00
    Date: 2009–06–07

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