nep-mkt New Economics Papers
on Marketing
Issue of 2013‒05‒05
seven papers chosen by
Joao Carlos Correia Leitao
University of Beira Interior and Technical University of Lisbon

  1. Consumer attitudes for new plant species using the example of Trachycarpus wagnerianus By Lampert, Paul; Menrad, Klaus; Schoeps, Johanna
  2. Word-of-Mouth in Movies with Platform Release: Theory and Evidence By Yijuan Chen; Xiaojing Ma; Qiang Pan
  3. The Price Premium for Organic Wines: Estimating a Hedonic Farm-gate Price Equation By Corsi, Alessandro; Strøm, Steinar
  4. The Use of Wireless Capability at Farmers Markets: Results from a Choice Experiment Study By R. Karina Gallardo; Aaron Olanie; Rita Ordonez; Marcia Ostrom
  5. Differential Pricing When Costs Differ: A Welfare Analysis By Yongmin Chen and Marius Schwartz
  6. Modeling the credit card revolution: the role of debt collection and informal bankruptcy By Lukasz A. Drozd; Ricardo Serrano-Padial

  1. By: Lampert, Paul; Menrad, Klaus; Schoeps, Johanna
    Abstract: This articles reviews the purchase behaviour of consumers for plants and the attitude towards horticultural novelties. The palm, Trachycarpus wagnerianus especially, is the main focus of this study. Based on a survey of 408 customers in Bavaria during autumn 2009, the results gave an impression of how consumers inform themselves about novelties in horticulture as well as their attitude to T. wagnerianus. Within the standardized questionnaire, a conjoint measurement was applied in order to investigate the impact of the different characteristics of the palm on consumers' choice. Drawing all factors of the conjoint measurement into consideration, the T. wagnerianus has slight advantages when compared to the common Trachycarpus fortunei.
    Keywords: Conjoint analysis, consumer research, palms, purchasing behaviour, Marketing, M30, Q10,
    Date: 2012
  2. By: Yijuan Chen; Xiaojing Ma; Qiang Pan
    Abstract: We study the word-of mouth effect on movies with platform release, a common marketing strategy in the motion picture industry. We construct a theoretical model which shows that the word-of-mouth effect together with a sliding-percentage contract between the movie distributor and exhibitors gives rise to the usage of platform release. Using the data in the U.S. motion picture industry from 2000 to 2005, we quantify the word-of mouth sales and estimate the information transmission process in the movies featuring platform release.
    Keywords: Word-of-Mouth, Platform Release, U.S.Motion Picture Industry
    JEL: L82 M31
    Date: 2013–04
  3. By: Corsi, Alessandro (Università di Torino, Department of Economics); Strøm, Steinar (Dept. of Economics, University of Oslo)
    Abstract: Organic wines are increasingly produced and appreciated. Since organic production is more costly, a crucial question is whether they benefit from a price premium. We estimate hedonic price functions for Piedmont organic and conventional wines. We use data on the production side in addition to variables of interest for consumers. Our results show that, along with characteristics of interest to consumers, some farm and producer characteristics not directly relevant for consumers do significantly affect wine prices. We find that organic wine tends to obtain higher prices than conventional wine. The price premium is not simply an addition to other price components, but organic quality modifies the impact of the other variables on price.
    Keywords: Organic wines; Hedonic price functions; Farming; Prices; Price variables
    JEL: C21 D49 L11 Q12
    Date: 2013–03–11
  4. By: R. Karina Gallardo; Aaron Olanie; Rita Ordonez; Marcia Ostrom (School of Economic Sciences, Washington State University)
    Abstract: One alternative for farmers’ markets to increase sales and expand the customer base is to implement wireless capability (credit and debit card, and electronic benefits transfer readers) at the markets. We estimate the value farmers’ markets managers and vendors posit on wireless machines attributes, and the values customers posit on markets’ features. The quality of the wireless machine technology and the machine provider customer service are the most important attributes for, respectively, managers and vendors. Consumers are willing to pay premium prices at farmers’ markets where this technology is available. This information is useful to policy makers and wireless machine providers to implement wireless capability at farmers markets.
    Keywords: farmers markets, sales, wireless capability
    JEL: Q13 Q18
    Date: 2013–04
  5. By: Yongmin Chen and Marius Schwartz (Department of Economics, Georgetown University)
    Abstract: This paper analyzes the welfare effects of monopoly differential pricing in the important but largely neglected case where marginal costs of service differ across consumer groups. Compared to uniform pricing, cost-based differential pricing generally raises total welfare. Although total output may fall or even its allocation across consumer groups may worsen, under a minor demand curvature condition at least one of these changes must be beneficial and dominate if the other is not. Aggregate consumer welfare also rises (under a mildly tighter condition). The source of consumer gains is not cost savings from output reallocation, which flow to the firm. Rather, to induce output reallocation the firm must vary its prices, thereby creating price dispersion without an upward bias in the average price. This improves consumer welfare even in cases where output falls. We contrast these results with those in the extensive literature on third-degree price discrimination and, furthermore, provide sufficient conditions for beneficial differential pricing when both demand elasticities and costs differ.
    Keywords: differential pricing, price discrimination, demand curvature, pass-through rate JEL Codes:
    Date: 2013–01–01
  6. By: Lukasz A. Drozd; Ricardo Serrano-Padial
    Abstract: In the data, most consumer defaults on unsecured credit are informal and the lending industry devotes significant resources to debt collection. We develop a new theory of credit card lending that takes these two features into account. The two key elements of our model are moral hazard and costly state verification that relies on the use of information technology. We show that the model gives rise to a novel channel through which IT progress can affect outcomes in the credit markets, and argue that this channel can be critical to understand the trends associated with the rapid expansion of credit card borrowing in the 1980s and over the 1990s. Independently, the mechanism of the model helps reconcile high levels of defaults and indebtedness observed in the US data.
    Keywords: Credit cards ; Consumer credit ; Credit ; Moral hazard
    Date: 2013
  7. By: Gabrielsen, Tommy Staahl (Department of Economics, University of Bergen); Johansen, Bjørn Olav (Department of Economics, University of Bergen)
    Abstract: We consider a setting where an upstream producer and a competitive fringe of producers of a substitute product may sell their products to two differentiated downstream retailers. We investigate two different contracting games; one with seller power and a second game with buyer power. In each game we characterize the minimum set of vertical restraints that make the vertically integrated profit sustainable as an equilibrium outcome, and we also characterize sufficient conditions for having interlocking relationships (i.e. no exclusion). In line with the recent literature, we focus on the performance of simple two-part tariffs, upfront payments and RPM as facilitating devices for reducing competition under both buyer and seller power. With seller power we show that minimum RPM, possibly coupled with a quantity roof, will allow the manufacturer to induce industry wide monopoly prices. With buyer power we show that monopoly prices may be induced if the retailers may use an upfront fee together with a two-part tariff and a minimum RPM.
    Keywords: resale price maintenance; seller power; buyer power; horsizontal control
    JEL: L42
    Date: 2013–04–11

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