nep-mkt New Economics Papers
on Marketing
Issue of 2018‒02‒19
ten papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Signals Sell: Product Lines when Consumers Differ Both in Taste for Quality and Image Concern By Friedrichsen, Jana
  2. Country of origin effect and perception of Romanian consumers By Clipa, Cătălin-Ioan; Danilet, Magdalena; Clipa, Anca-Maria
  3. Interpretable Perceived Topics in Online Customer Reviews for Product Satisfaction and Expectation By Aijing Xing; Nobuhiko Terui
  4. Product Differentiation with Multiple Qualities By Francesca Barigozzi; Ching-to Albert Ma
  5. Commodity taxes and taste heterogeneity By Stéphane Gauthier; Fanny Henriet
  6. An Evaluation of the CPI Indexes for Prescription Drugs By Barry Bosworth; John Bieler; Michael Kleinrock; Eric Koepcke; Ernst R. Berndt
  7. The Effects of Fair Trade Certification: Evidence from Coffee Producers in Costa Rica By Raluca Dragusanu; Nathan Nunn
  8. Secret contracting in multilateral relations By Patrick Rey; Thibaud Vergé
  9. Proposition d'une échelle de perception de la vie privée sur les smartphones By Eric Benedetto; Jean‐pierre Tang‐taye; Stéphane Bourliataux‐lajoinie
  10. Mobile applications and access to private data: The supply side of the Android ecosystem By Kesler, Reinhold; Kummer, Michael E.; Schulte, Patrick

  1. By: Friedrichsen, Jana (Humboldt-Universität zu Berlin)
    Abstract: This paper analyzes optimal product lines when consumers differ both in their taste for quality and in their desire for social image. The market outcome features partial pooling and product differentiation that is not driven by heterogeneous valuations for quality but by image concerns. A typical monopoly outcome is a two-tier product line resembling a \"masstige\" strategy as observed in luxury goods markets. Products can have identical quality and differ only in price and image, thereby rationalizing quality-equivalent line extensions. Under competition, both average quality and market coverage are (weakly) higher but monopoly can yield higher welfare than competition.
    Keywords: image concern; conspicuous consumption; two-dimensional screening; nonlinear pricing;
    JEL: L12 L15 D11 D21 D82
    Date: 2018–02–08
  2. By: Clipa, Cătălin-Ioan; Danilet, Magdalena; Clipa, Anca-Maria
    Abstract: In the context of globalization, international trade has become more intense. This exploratory research aims to identify the Romanian consumers' perception of the country of origin (COO). In the present research, we analysed two perspectives of the effect of the country of origin: political economy and marketing. The positive impact of campaigns to encourage the purchase of domestic products has not yet been confirmed for the decision-makers. On the other hand, in order to achieve a successful marketing strategy, it is essential to know the consumer’s perception of the COO effect. The research data was collected through a survey conducted on a sample of 250 respondents from the North-East Region of Romania. The results confirm that the effect of the home country has a moderate impact on purchases and the COO effect is more associated with certain product categories. The average COO effect on quality perception is greater than the COO's average effect on purchasing intent.
    Keywords: Country of origin effect; buy national; product category; consumer perception
    JEL: F14 M21 M31
    Date: 2017–01
  3. By: Aijing Xing; Nobuhiko Terui
    Abstract: Online customer reviews contain useful and important information, in particular, for product management--because customers tend to praise or criticize certain features or attributes of goods in their reviews. We propose a model that extracts the perceived topics from textual reviews by natural language processing under the restrictions of their interpretability and predictability of product satisfaction as current product evaluation and expectation as future possible demand by supervised learning. The empirical analysis on user-generated content of food reviews shows that our proposed model performs better than alternative models, and it suggests product managers the necessity of improving some specific attributes and focus their advertising on these attributes as fulfilling customer needs.
    Date: 2018–02
  4. By: Francesca Barigozzi (Department of Economics, University of Bologna); Ching-to Albert Ma (Boston University)
    Abstract: We study subgame-perfect equilibria of the classical quality-price, multistage game of vertical product differentiation. Each firm can choose the levels of an arbitrary number of qualities. Consumers' valuations are drawn from independent and general distributions. The unit cost of production is increasing and convex in qualities. We characterize equilibrium prices, and the effects of qualities on the rival's equilibrium price in the general model. We present necessary and sufficient conditions for equilibrium differentiation in any of the qualities.
    Keywords: multidimensional product differentiation, quality and price competition
    JEL: D43 L13
    Date: 2017–11
  5. By: Stéphane Gauthier (PSE - Paris School of Economics, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique); Fanny Henriet (PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics)
    Abstract: We study optimal linear commodity taxes in the presence of non-linear income taxes when agents differ in skills and tastes for consumption. We show that optimal commodity taxes are partly determined by a many-person Ramsey rule when there is taste heterogeneity within income classes. The usual role of commodity taxes in relaxing incentive constraints explains the remaining part of these taxes when there is taste heterogeneity between income classes. We quantify these two parts using French consumption microdata and find that commodities taxes are only shaped by many-person Ramsey considerations.
    Keywords: Social valuations,Income taxation,Taste heterogeneity,Commodity taxes
    Date: 2018–01
  6. By: Barry Bosworth; John Bieler; Michael Kleinrock; Eric Koepcke; Ernst R. Berndt
    Abstract: The prescription drug component of the Consumer Price Index (CPI measures recent and past drug price changes, and provides the basis for projecting future price trends and health care expenditures. However, there are concerns about the adequacy of the price data because of recent changes in the structure of the market for prescription drugs. We compare the prescription drug data of the CPI with a large alternative data set from the IQVIA Institute for Human Data Science. We analyze the overall consistency if the data from the two sources, and examine the influence of the large shift from brand to generic drug sales and the increased reliance on third party insurance plans that are excluded from the CPI sampling frame.
    JEL: D04 I11 I18 L11 L65
    Date: 2018–01
  7. By: Raluca Dragusanu; Nathan Nunn
    Abstract: We examine the effects of Fair Trade (FT) certification of coffee on producers and households in Costa Rica. Examining the production dynamics of the universe of Costa Rican coffee mills from 1999–2014, we find that FT certification is associated with a higher sales price, greater sales, and more revenues. As expected, these effects are greater when global coffee prices are lower and the FT guaranteed minimum price is binding. Looking at households, we find evidence that FT is associated with higher incomes for all families, but especially for those working in the coffee sector. However, we also find that, within this sector, the benefits are not evenly distributed. Skilled coffee growers benefit from FT, intermediaries are hurt, and unskilled workers are unaffected. Thus, although FT creates sizable benefits (on average), it also results in a redistribution from intermediaries to farmers. Lastly, we also find evidence of positive effects of FT certification on the education of high-school-aged children, which is most likely due to the presence of scholarship programs that are funded by FT premiums.
    JEL: F14 O13 O54
    Date: 2018–01
  8. By: Patrick Rey (Toulouse School of Economics, University Toulouse Capitole); Thibaud Vergé (CREST; ENSAE)
    Abstract: We develop a general but tractable framework of multilateral vertical contracting between upstream and downstream ?firms, without any restriction on tariffs, and yet taking into account their impact on downstream competition. In equilibrium, tariffs are cost-based and replicate the outcome of a multi-brand oligopoly, a fi?nding in line with the analysis of a recent merger. To illustrate its versatility, we use this framework to analyze the effect of vertical restraints (resale price maintenance and retail price parity clauses) and of alternative business models (resale vs. agency). Finally, we extend the framework so as to endogenize the market structure.
    Keywords: Bilateral contracting; vertical relationships; agency; resale price maintenance;price parity clauses
    JEL: L13 L42 D43 K21
    Date: 2017–07–17
  9. By: Eric Benedetto; Jean‐pierre Tang‐taye (IAE - Institut d'Administration des Entreprises - UR - Université de la Réunion); Stéphane Bourliataux‐lajoinie (Institut d'Administration des Entreprises (IAE) - Tours)
    Abstract: Perception of privacy on smartphones: a proposed scale Abstract The smartphone takes such a place that it may be seen as an extension of the memory and social life of mobile users called " mobinautes " in France with over 40 million of customers. This interconnection between data exchange and privacy leads to a complex marketing challenge where the borders are not clearly measurable. By using a symbiotic approach the paper develops a measuring scale focused on privacy and highlights the need for a multidimensional view with innovation, utility, dependence and added value as additional constructs. Through a structural model data analysis using SPSS and AMOS the findings suggest some implications in marketing strategy likely to interest network mobile phone providers and further academic research.
    Abstract: Avec plus de 40 millions de smartphones, la France dispose d'un taux d'équipement en augmentation constante et le smartphone est devenu en quelques années un compagnon de la vie courante comme une extension de la mémoire et le garant de la vie sociale du mobinaute. Le but de la recherche exploratoire entreprise ici est de développer une échelle de mesure qui prenne en compte principalement la perception de la vie privée (privacy) sur les smartphones et de la tester via un questionnaire en ligne. L'analyse de données réalisée en utilisant SPSS et AMOS via un modèle structurel sur les 371 réponses obtenues montre qu'une approche multidimensionnelle est nécessaire et met en évidence une relation symbiotique entre le mobinaute et son smartphone maillant les concepts de dépendance, utilité, d'innovation et de valeur ajoutée. Des retombées marketing ainsi que des perspectives de recherche académique plus approfondies sont aussi proposées.
    Keywords: smartphone,privacy,added value,perceived usefulness,confide ntiality,MMI,structural equation,valeur ajoutée,utilité perçue,confidentialité,IHM,équation structurelle
    Date: 2016–01–21
  10. By: Kesler, Reinhold; Kummer, Michael E.; Schulte, Patrick
    Abstract: We analyze the data collection strategies of 65,000 developers in the market for mobile applications and track 300,000 applications over four years. Many apps belong to developers with multiple apps. This fact generates variation in the privacy behaviors of the same developer for our analysis. We uncover three stylized facts: First, developers "learn" to use increasingly intrusive data strategies as they become more experienced. Second, intrusive data collection is most likely in apps that target the 13+, and 16+ age category, which raises concerns for the protection of young app consumers. Third, even within developers, critical and atypical permissions predict problematic usage of private user data most successfully. Our findings inform both regulators and scientists who wish to model supply in the market for mobile apps.
    Keywords: Mobile Applications,Developers,Learning,Data Collection,Privacy
    JEL: O3 L1 D62 D85 D29
    Date: 2017

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