Assessing the Effect of Information on the Reservation Price for Champagne: What are Consumers Actually Paying for?

2006 ◽  
Vol 1 (1) ◽  
pp. 75-88 ◽  
Author(s):  
Pierre Combris ◽  
Christine Lange ◽  
Sylvie Issanchou
Keyword(s):  
Willingness To Pay ◽  
Detailed Analysis ◽  
Sensory Information ◽  
Jel Classification ◽  
Reservation Price ◽  
Vickrey Auctions ◽  
Individual Behaviors ◽  
Reservation Prices ◽  
Large Heterogeneity

AbstractTwo series of Vickrey auctions have been performed to assess the effect of packaging information (bottle and label) on the reservation prices of ordinary consumers for five brut non-vintage Champagnes. As in other studies on wine tasting, packaging information is found to explain much more of the variation in willingness to pay than sensory information. Participants are unable, or unwilling, to put different values on the Champagnes after blind tasting, but significant differences in reservation prices appear when labels are disclosed. Detailed analysis of choices reveals a large heterogeneity in individual behaviors and valuations of the Champagnes included in this study. (JEL Classification: C91, D12)

Penilaian Efisiensi Bank dengan Data Envelopment Analysis pada 10 Bank Berperingkat Besar di Indonesia

2015 ◽  
Vol 2 (02) ◽  
pp. 113-126
Author(s):  
J.M.V. Mulyadi
Keyword(s):  
Data Envelopment Analysis ◽  
Detailed Analysis ◽  
Jel Classification ◽  
Financial Ratios ◽  
Data Envelopment ◽  
Bank Efficiency ◽  
Efficiency Assessment ◽  
Production Approach

A B S T R A C T Bank efficiency are important in the assessment of the health of banks. Data Envelopment Analysis is a model of efficiency assessment bank that is widely used because it provides a more detailed analysis of the results compared to financial ratios. Analysis carried out by the production approach, intermediation, revenues and profits. This study assesses the 10 major banks in Indonesia. The results showed that of the 10 large banks are still found inefficiencies. DEA resulted in a recommendation that development can be done bank to achieve optimum efficiency. Based on the recommendation expected the bank to maximize the desired profit through efficiency. A B S T R A K Efisiensi bank merupakan hal penting dalam penilaian kesehatan bank. Data Envelopment Analysis adalah model penilaian efisiensi bank yang banyak digunakan karena memberikan hasil analisis yang lebih detil dibandingkan rasio keuangan. Analisi dilakukan dengan pendekatan produksi, intermediasi, pendapatan dan laba. Penelitian ini melakukan penilaian pada 10 bank besar di Indonesia. Hasil penelitian menujukkan bahwa dari 10 bank besar tersebut masih ditemukan inefisiensi. DEA menghasilkan rekomendasi pengembangan yang dapat dilakukan bank untuk mencapai efisiensi optimum. Berdasarkan rekomendasi tersebut diharapkan bank dapat memaksimumkan profit yang diinginkan melalui efisiensi. JEL Classification: G29, O33

scholarly journals What are domestic apples worth? Hedonic responses and sensory information as drivers of willingness to pay

2015 ◽  
Vol 43 ◽  
pp. 97-105 ◽  
Author(s):  
Laila Seppä ◽  
Terhi Latvala ◽  
Faical Akaichi ◽  
José M. Gil ◽  
Hely Tuorila
Keyword(s):  
Willingness To Pay ◽  
Sensory Information

The concept of market value in thin markets and its implications for international accounting rules (IFRS)

2019 ◽  
Vol 37 (3) ◽  
pp. 301-310 ◽  
Author(s):  
Hans Lind ◽  
Bo Nordlund
Keyword(s):  
Balance Sheet ◽  
Market Value ◽  
Reservation Price ◽  
Content Type ◽  
Current Accounting ◽  
Thin Markets ◽  
Thin Market ◽  
Reservation Prices ◽  
Accounting Rules ◽  
Conceptual Paper

Purpose The purpose of this paper is to discuss how the concepts market value (MV) and exit price should be interpreted in thin markets and how accounting rules may need to change to take this into account. Design/methodology/approach This is a conceptual paper using hypothetical examples as a base for the conclusions. Findings In a thin market, actors can have rather different reservation prices. The price will then be set through bargaining and the agreed price could be considerable above the reservation price of the actor with the second highest reservation price. The exit price should then be below what the MV was before the transaction and below the entry price, and according to the current accounting rules, the value in the balance sheet should then be below the price paid. The authors’ experience is, however, that this rarely happens in practice. Research limitations/implications The limitation of the paper is that it is a conceptual paper and not based a systematic empirical study of accounting practices. Practical implications The results of the paper indicate that there is a need to revise the current accounting rules. Possible changes are discussed. Originality/value As far as the authors know, this is the first paper that looks at problems in the current value concepts related to differences in reservation prices in thin markets.

scholarly journals Bidding Behaviors in eBay Auctions: Secret Reservation Price and Endogenous Entry

2011 ◽  
Vol 3 (5) ◽  
pp. 326-331
Author(s):  
Feng Jiao
Keyword(s):  
Reservation Price ◽  
Endogenous Entry ◽  
Luxury Goods ◽  
Reservation Prices ◽  
Optimal Bidding ◽  
Ebay Auctions

This paper analyzes the secret reservation price in eBay auctions. Under the assumptions of secret and public reservation price, the bidders choose the optimal bidding function and the seller selects equilibrium reservation price. This model argues that the choice of secret reservation price is rational for the seller, as they can generate higher revenue in certain conditions. It predicts that, under endogenous entry, secret reservation price leads to higher revenue since it attracts more bidders to the auction. This effect is more noticeable for luxury goods. However, secret and public reservation prices generate identical revenue for the seller if entry is exogenous. Furthermore, the results are supported by numerous recent empirical works.

scholarly journals On the economic nature of consumers’ willingness to pay for a selective and sustainable fishery: A comparative empirical study

2018 ◽  
Vol 82 (S1) ◽  
pp. 91 ◽  
Author(s):  
Laura Onofri ◽  
Paolo Accadia ◽  
Paloma Ubeda ◽  
Maria José Gutiérrez ◽  
Evelina Sabatella ◽  
...  
Keyword(s):  
Willingness To Pay ◽  
Public Good ◽  
Model Specification ◽  
Reservation Price ◽  
Pure Public Good ◽  
Instrumental Variable Regression ◽  
Two Samples ◽  
Socio Economic Variables ◽  
Sustainable Fishery ◽  
Contingent Valuation Methods

The EU Landing Obligation (LO) bans discards to incentivize a more selective and sustainable fishery. This regulation may induce a cost to the fishing industry that could be transferred to final fish consumers. We aim to assess the consumers’ reservation price for a sustainable and selective fishery. The methodology follows two steps: We first assess the value of the reservation price (willingness to pay, WTP) for a sustainable and selective fishery by using contingent valuation methods from a comparative perspective in Spain and Italy. We then attempt to empirically assess the components of WTP by using an original model specification that, unlike those presented in the literature, exogenizes socio-economic variables and uses ideological indicators to explain WTP in a two-line simultaneous model estimated by instrumental variable regression. The results show a positive, though low, WTP across the two samples, and very different impacts of estimated coefficients on the WTP for the two samples. A preliminary interpretation of this divergence highlights that Italian consumers consider LO-incentivized sustainable fishery a pure public good linked to issues of legality, and Spanish consumers consider it an impure public good linked to environmental issues. These differences may indicate how strongly the institutions and the policies in each region are perceived by a different human capital structure. They may also indicate that the problem, the perceptions of it and the solutions to it differ according to the context.

scholarly journals Vulnerability and Willingness to Pay for Coping with Flood in Klaten Regency, Central Java, Indonesia

2017 ◽  
Vol 2 (2) ◽  
pp. 38-44
Author(s):  
Suryanto Suryanto ◽  
Sutrisno Sutrisno ◽  
Evi Gravitiani ◽  
Fitri Susilowati
Keyword(s):  
Willingness To Pay ◽  
Contingent Valuation ◽  
Economic Valuation ◽  
Sampling Technique ◽  
Jel Classification ◽  
Flood Mitigation ◽  
Factors Affecting ◽  
Central Java ◽  
Household Water ◽  
Contingent Valuation Methods

Objective - The focus of this research is the analysis of vulnerability and factors that influence willingness to pay (WTP) to cope with flood. Other result of this research is economic valuation of flood impact on paddy field in particular. Methodology/Technique - This research used the descriptive and quantitative method. Its data were collected through direct interviews with 380 respondents. Its samples were scattered in 11 sub-districts and 94 villages. The representatives of each village were 4 respondents, by adding two respondents from Wedi Sub-district and 2 respondents from Cawas Sub-district. Proportional sampling technique was employed to determine the research samples with criteria: very close (<50 m), close (50-100 m), and far (> 100 m) from the river. Its data were analyzed by using contingent valuation methods (CVM). Findings - The results of the research are as follows. Many activities have been implemented to mitigate flood in Klaten Regency, but many problems have been encountered due to the limitations of Government Budget (APBD). The variables of income of family/household, water level, distance, and loss have a significant effect on the WTP. In majority, the respondents (72.27%) have the WTP for flood mitigation activities with the average WTP of 15,391 IDR. Novelty - Economic valuation of flood mitigation programs and activities is required as to further enhance the role of the community, taking into account factors affecting the WTP. The local government should take advantage of the public's WTP to support flood mitigation activities among neighbourhood, village, sub-district and regency. Type of Paper: Empirical Keywords: Vulnerability; Flood Mitigation; Contingent Valuation; Willingness to Pay (WTP). JEL Classification: D12, H84.

scholarly journals PUBLIC PERCEPTION OF THE VEHICLE OWNERSHIP TRANSFER FEES (BBNKB) INCREMENT POLICY IN BANDAR LAMPUNG

2019 ◽  
Vol 4 (01) ◽  
pp. 36
Author(s):  
Nairobi Nairobi
Keyword(s):  
Willingness To Pay ◽  
Public Perception ◽  
Jel Classification ◽  
Survey Method ◽  
Cluster Sampling ◽  
Price Difference ◽  
Vehicle Ownership ◽  
Ownership Transfer ◽  
The People ◽  
Transfer Fees

<p><em>The aim of the study is to estimate the number of vehicles with </em><em>Lampung outside p</em><em>olice numbers</em><em> </em><em>operating in Lampung and to find</em><em> </em><em>out the public perceptions</em><em> </em><em>of</em><em> </em><em>the Lampung</em><em> </em><em>Provincial</em><em> </em><em>Government's policy through </em><em>Local Regulations</em><em> </em><em>Number</em><em> 2 of 2011</em><em>, </em><em>regarding the increase in v</em><em>ehicle ownership transfer fees</em><em> (BBNKB) from 10 percent to 12.5 percent, along with willingness to pay from the policy. This research applies survey method in Bandar Lampung</em><em> </em><em>city with the population of the people who are the owner of new motor</em><em> </em><em>vehicles  including the four-wheeled and two-</em><em>w</em><em>heeled which were</em><em> </em><em>purchased starting</em><em> </em><em>in</em><em> </em><em>20</em><em>1</em><em>2 outside</em><em> </em><em>the province</em><em> o</em><em>f Lampung</em><em>. </em><em>The sampling method used is cluster sampling, meaning that the population is divided into several clusters. As the population of vehicles which have no BE police number operating in Lampung is unknown, then the number of the sample is set to 100 respondents.</em><strong><em></em></strong></p><p><em>Based on the result of the survey, it is unravelled that there are 18 percent of cars which have non-BE plate number operating in Lampung, and for motorcycles, there are only 4 percent. Another finding shows the fact that respondents buy vehicles outside the province of Lampung  because the price difference is quite significant and they do not do second BNKB in Lampung Province in accordance with its operational area. From the willingnes to pay, all respondents approve that if the rate of BBNKB decreases back to 10 percent,  most of them will return to buy a new vehicle in Lampung due to the fact that there will be smaller price difference between the price of a new car purchased in Lampung Province and new car purchased outside Lampung Province. BBNKB tariff reduction will provide opportunities for trade of vehicles in Lampung Province to be more competitive, thus, they can develop better. Moreover, there will be more exciting investments and more job fields in the automotive sector.</em><em></em></p><p><strong><em>JEL Classification: </em></strong><em>H20,<strong> </strong>H21, H24</em></p><p><strong><em>Keywords: </em></strong><em>BBNKB Tariff, Public Perception, Willingness to Pay</em></p>

scholarly journals Implications of the reservation price strategy on the optimal harvest decision and production of nontimber goods in an even-aged forest stand

2019 ◽  
pp. 287-296
Author(s):  
Andres Susaeta ◽  
Peichen Gong ◽  
Damian Adams
Keyword(s):  
Carbon Sequestration ◽  
Longleaf Pine ◽  
Pinus Palustris ◽  
Poor Quality ◽  
Planting Density ◽  
Reservation Price ◽  
Price Strategy ◽  
Water Production ◽  
Reservation Prices ◽  
Harvest Strategy

This study analyzes the effects of adopting an adaptive harvest strategy in even-aged forest management under timber price uncertainty on the production of nontimber goods. We use the reservation price strategy (“harvest when the observed timber prices are higher than the reservation prices”) on a longleaf pine (Pinus palustris Mill.) stand and employ the Faustmann–Hartman model as a benchmark. We assume that a longleaf pine stand can be managed for timber production, water production, carbon sequestration, and pine straw raking, depending on the planting density. Our results indicate that the reservation price strategy leads to longer expected harvest age when planting density is high. The reservation price strategy does not lead to increases in water production and carbon sequestration with low planting density. With high planting density, the reservation price strategy leads to increases in the amount of in situ carbon sequestered by 14.4–24.7 Mg·ha–1. Our findings suggest that managing longleaf pine forests in good- or poor-quality sites is a profitable alternative and enables water production and carbon sequestration.

Persuasive Advertising in a Vertically Differentiated Competitive Marketplace

2020 ◽  
Vol 18 (1) ◽  
pp. 145-177
Author(s):  
Yuanfang Lin ◽  
Chakravarthi Narasimhan
Keyword(s):  
Willingness To Pay ◽  
Price Competition ◽  
Consumer Preferences ◽  
Product Category ◽  
General Assumption ◽  
Reservation Price ◽  
Theoretic Approach ◽  
Persuasive Advertising ◽  
Game Theoretic ◽  
The Cost

AbstractDespite the widely acknowledged existence in practice, the theoretical literature on persuasive advertising is generally vague about exactly how such advertising could affect consumer preferences, except for the general assumption that persuasive advertising affects consumer willingness to pay or simply “shifts demand.” This paper proposes a theoretical framework for characterizing different ways that persuasive advertising may affect consumer utility in a vertically differentiated marketplace. Firstly, persuasive advertising could simply raise consumers’ reservation price for the product category. Secondly, persuasive advertising could enhance consumers’ perception about the product quality offered by the advertising firm. Thirdly, persuasive advertising could increase consumers’ willingness to pay for quality increment. Preliminary evidences from lab studies are presented to support the existences of the proposed effects. Using a game-theoretic approach, we study two firms’ decision in the adoption of persuasive advertising of a particular effect and the associated price competition. Findings from the theoretical model analyses indicate that factors influencing a firm’s decision in persuasive advertising include consumer heterogeneity, degree of product differentiation, the effectiveness and the cost of such advertising. In a vertically differentiated competitive marketplace, persuasive adverting is a more desirable strategic tool for firms of higher-quality products to further establish a competitive advantage.

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