scholarly journals Advance Selling with Part Prepayment and Consumer Returns

2018 ◽  
Vol 2018 ◽  
pp. 1-15
Author(s):  
Yanhong Sun ◽  
Tana Siqin ◽  
Lifeng Mu
Keyword(s):  
Theoretical Model ◽  
Information Disclosure ◽  
Product Information ◽  
Selling Price ◽  
Cross Effect ◽  
Advance Selling ◽  
Consumer Returns ◽  
Return Policy ◽  
Handling Cost ◽  
Ex Ante

Part prepayment scheme can induce more consumers to purchase the product in advance but may also lead to the increase in consumer returns. This study develops a two-period theoretical model to examine the interaction between the part prepayment scheme and the return policy and its effect on the retailer’s profit. Our analysis yields the following insights. First, part prepayment scheme can help the retailer to increase the demand without sacrificing the advance selling price. Second, the prepayment proportion and the consumers’ hassle cost of return have a negative cross effect on the retailer’s profit, which indicates that when the consumers are allowed to preorder the product with a relatively low proportion of prepayment, the retailer should impose more restrictions to increase the consumers’ hassle cost of return. Third, the prepayment proportion and the ex-ante product information perceived by consumers also have a negative cross effect on the retailer’s profit, which indicates that the retailer should consider the degree of product information disclosure when adopting the part prepayment scheme. We also extend the model to incorporate the retailer’s handling cost of consumer returns and find that it is beneficial for the retailer to require a full prepayment when the handling cost is relatively high.

Selling Virtual Items in Free-to-Play Games: Transparent Selling vs. Opaque Selling

2021 ◽  
Author(s):  
Yifan Jiao ◽  
Christopher S. Tang ◽  
Jingqi Wang
Keyword(s):  
Theoretical Model ◽  
Online Games ◽  
Skill Level ◽  
Selling Price ◽  
Online Game ◽  
Game Theoretical Model ◽  
Level Information ◽  
The Given

The market for online games is huge, but research on the economics of online game operations remains nascent. In this paper, we focus on “free-to-play” online games in which a game provider offers players an option to purchase game-specific virtual goods (items) for improving their winning chances before the game begins. Because selling virtual items is the main revenue stream in free-to-play games, it is important for game providers to find ways to entice players to purchase virtual items. We observe that some game providers disclose the opponent’s skill level before the game begins by using a “transparent selling” mechanism to sell virtual items, whereas others conceal this information from the players. This observation motivates us to examine whether and when game providers should adopt transparent selling. By analyzing a game-theoretical model that involves one game provider and two competitive players, we obtain the following results. First, when the price of the virtual goods is endogenously determined by the game provider, we find that transparent selling is not effective: it is optimal for the provider to adopt “opaque selling” by concealing the opponent’s skill level information from players. However, opaque selling hurts the player’s welfare. Second, when the selling price is exogenously given, transparent selling dominates opaque selling when the given price is high. Our results identify the conditions under which transparent selling dominates opaque selling.

scholarly journals Operational dilemmas in safety-critical industries: The tension between organizational reputational concerns and the effective communication of risk

2019 ◽  
pp. 1-18
Author(s):  
Ambisisi Ambituuni ◽  
Chibuzo Ejiogu ◽  
Amanze Ejiogu ◽  
Maktoba Omar
Keyword(s):  
Theoretical Model ◽  
Information Disclosure ◽  
Critical Incident ◽  
Critical Incidents ◽  
Press Releases ◽  
Image Repair ◽  
Safety Critical ◽  
Image Repair Theory ◽  
The Face ◽  
Information Manipulation

AbstractOrganizations involved in safety-critical operations often deal with operational tensions, especially when involved in safety-critical incidents that is likely to violate safety. In this paper, we set out to understand how the disclosures of safety-critical incidents take place in the face of reputational tension. Based on the case of the Nigerian National Petroleum Corporation (NNPC), we draw on image repair theory and information manipulation theory and adopt discourse analysis as a method of analyzing safety-critical incident press releases and reports from the NNPC. We found NNPC deploying image repair as part of incident disclosures to deflect attention, evade blame and avoid issuing apologies. This is supported by the violation of the conversational maxims. The paper provides a theoretical model for discursively assessing the practices of incident information disclosure by an organization in the face of reputational tension, and further assesses the risk communication implications of such practices.

Can product-information disclosure increase Chinese consumer’s willingness to pay for GM foods? The case of Fad-3 GM lamb

2017 ◽  
Vol 9 (3) ◽  
pp. 415-437 ◽  
Author(s):  
Qihui Chen ◽  
Gaoshuai Liu ◽  
Yumei Liu
Keyword(s):  
Willingness To Pay ◽  
Information Disclosure ◽  
Product Information ◽  
Contingent Valuation Method ◽  
Food Product ◽  
Chinese Consumers ◽  
Content Type ◽  
Gm Food ◽  
Valuation Method ◽  
Gm Foods

Purpose The purpose of this paper is to examine Chinese consumers’ level of perception of genetically modified (GM) foods and the determinants of their willingness to pay (WTP) for Fad-3 GM lamb, a newly developed GM product. Design/methodology/approach Based on a randomized choice experiment involving 576 consumers in Beijing, the authors adopt a double-bounded contingent valuation method to estimate consumers’ WTP for Fad-3 GM lamb, as well as the causal impact of (randomized) product-information disclosure on it. Findings The econometric result indicates that the randomly disclosed product information describing details about Fad-3 GM lamb, the potential risks associated with the consumption of it, and the related governmental regulation policies raised consumers’ WTP by 6.2 yuan per Jin (or US$2/kilogram). Originality/value This paper provides new experimental evidence of the effect of product-information disclosure on consumers’ WTP for a newly developed GM food product.

Product Information Disclosure

1976 ◽  
Vol 10 (2) ◽  
pp. 113-113
Author(s):  
Martin I. Blake ◽  
George Akrivos
Keyword(s):  
Information Disclosure ◽  
Product Information

scholarly journals The role of resources in recombinations and the degree of novelty of products

2021 ◽  
Vol 9 (3) ◽  
pp. 522-556
Author(s):  
Juan Pablo Camani
Keyword(s):  
Theoretical Model ◽  
Emerging Markets ◽  
Integrative Review ◽  
The Novel ◽  
Review Of The Literature ◽  
Ex Ante ◽  
Low Levels ◽  
Resource Characteristics ◽  
Novel Products

Objective of the study: To explain the characteristics and dynamics of resources and recombinations associated with developing products with low and high novelty.Methodology/Approach: The method was an integrative review of the literature on recombinant innovation. It included a creative synthesis that resulted in a theoretical model. Originality/Relevance: The research addresses topics the literature neglects, like explaining which resources and recombinations and why could relate to high or low product novelty.Main results: Certain features of resources (i.e., heterogeneity, specificity, accessibility) with high and low levels may differently influence costs, variety, and frequency of recombinations and, in turn, product novelty. To develop highly novel products, tangible resources, and internally produced new resources may be essential, as knowledge by itself may not be sufficient.Theoretical contributions: Different resource characteristics and their influence on recombinations may help explain whether a product will have low or high novelty. By going beyond the novel recombinations, the research expands the literature's understanding of recombinations and product novelty.Managerial contributions: Companies could assess ex ante which degree of product novelty besides types and costs of recombinations would result from their pools of resources. This assessment would make innovation more efficient for companies with fewer resources, like may occur in emerging markets.

scholarly journals Metode Job Order Sebagai Strategi Memenangkan Persaingan

PARAMETER ◽  
2021 ◽  
Vol 6 (1) ◽  
pp. 50-64
Author(s):  
Eko Setiobudi
Keyword(s):  
Mass Production ◽  
Product Information ◽  
Negotiation Process ◽  
Pricing Strategy ◽  
Selling Price ◽  
Research Subjects ◽  
Study Approach ◽  
Production Output ◽  
General Section ◽  
The Cost

The research was conducted using a case study approach, which is an approach used to investigate and understand an event or problem that has occurred by collecting various kinds of information which is then processed to obtain a solution so that the problems revealed can be resolved, with an emphasis on a certain deeper analysis depth. Specific. The research subjects targeted in this study are; Accounting Section, Production Section, Marketing Section, Finance Section, Project Section and General Section (GA). The objects of this research are (1) the costs used in determining the cost of goods manufactured to be sold by the company, (2) the method of determining the cost of production and the method of determining the selling price of production. As an EMS company, the strategies to win the competition are service quality, capability and price. Pricing strategy is an important part of getting orders or orders from principals. Therefore, the method used is the job order cost method, which is influenced by the number of orders and quality standards. The stages of the pricing strategy include (1) product information, (2) cost variable calculations, (3) HPP determination, (4) price negotiation, (5) MVA creation. And it turns out that in the negotiation process, the agreed price could be below the HPP price or vice versa. Even though it is under HPP, it doesn't necessarily cause a loss, because efficiency can be done during the actual production process during mass production. This efficiency is done by reducing the process or increasing the production output per day. So that a number of orders can be completed in a faster time. Thus, one important aspect in the context of determining the selling price is the company's ability to encourage efficiency and increase its production output capacity. Abstrak Penelitian dilakukan dengan menggunakan pendekatan studi kasus, yakni pendekatan yang digunakan untuk menyelidiki dan memahami sebuah kejadian atau masalah yang telah terjadi dengan mengumpulkan berbagai macam informasi yang kemudian diolah untuk mendapatkan sebuah solusi agar masalah yang diungkap dapat terselesaikan, dengan menitikberatkan pada kedalaman analisis tertentu yang lebih spesifik. Subyek penelitian yang disasar dalam penelitian ini adalah ; Bagian Akutansi, Bagian Produksi, Bagian Pemasaran, Bagian Keuangan, Bagian Project dan Bagian Umum (GA). Adapun obyek penelitian ini adalah (1) biaya-biaya yang digunakan dalam penentuan harga pokok produksi yang akan dijual oleh perusahaan, (2) metode penentuan harga pokok produksi dan metode penentuan harga jual produksi. Sebagai perusahaan EMS, strategi untuk memenangkan persaingan, yakni kualitas pelayanan, kapabilitas dan harga. Strategi harga menjadi bagian penting untuk mendapatkan order atau pemesanan dari prinsipal. Oleh sebab itu, metode yang dipakai adalah dengan job order cost method yang diantaranya dipengaruhi oleh jumlah pesanan dan standar kualitas. Tahapan strategi harga yang dilakukan antara lain dengan (1) informasi produk, (2) perhitungan variabel biaya, (3) penentuan HPP, (4) negosiasi harga, (5) pembuatan MVA. Dan ternyata dalam proses negosiasi, harga yang disepakti bisa jadi bawah harga HPP atau sebaliknya. Meskipun di bawah HPP, namun tidak serta merta mengalami kerugian, karena dapat dilakukan efisiensi pada saat proses produksi aktual selama mass production. Efisiensi ini dilakukan dengan menguranggi proses ataupun meningkatkan output produksi per harinya. Sehingga sejumlah pemesanan dapat diselesaikan dalam waktu yang lebih cepat. Dengan demikian, salah satu aspek penting dalam konteks menentukan harga jual adalah kepampuan perusahaan untuk mendorong efisiensi dan meningkatkan kapasitas output produksinya.

Hazards or Hassles The Effect of Sanctions on Leader Survival

2015 ◽  
Vol 5 (1) ◽  
pp. 143-161 ◽  
Author(s):  
Amanda A. Licht
Keyword(s):  
Theoretical Model ◽  
Empirical Work ◽  
Economic Sanctions ◽  
Ex Ante ◽  
Leader Survival ◽  
Modest Effect

Recent empirical work scrutinizes the ability of economic sanctions to destabilize targeted leaders. Limitations in data and modeling choices, however, may have inflated estimates of sanctions’ efficacy. I propose a unified theoretical model, incorporating the possibility that leaders targeted with threats and imposed sanctions differ in baseline risks from those who are not. I combine this hazards approach with an empirical strategy to account for differences in ex ante risks and improved data on leader failure. This approach uncovers a considerably more modest effect. Sanctions rarely destabilize their targets.

Estimating the housing price with a search-and-matching model

2015 ◽  
Vol 8 (2) ◽  
pp. 196-216
Author(s):  
Gaetano Lisi ◽  
Mauro Iacobini
Keyword(s):  
Theoretical Model ◽  
Real Estate ◽  
Housing Market ◽  
House Price ◽  
Price Adjustment ◽  
Selling Price ◽  
Search And Matching ◽  
Content Type ◽  
Time On The Market ◽  
Matching Models

Purpose – This paper aims to pose an important starting point for the application of the search-and-matching models to real estate appraisals, thus reducing the “gap” between practitioners and academicians. Due to relevant trading frictions, the search-and-matching framework has become the benchmark theoretical model of the housing market. Starting from the large related literature, this paper develops a simplified approach to modelling the frictions that focuses on the direct relationship between house price and market tightness (a common feature only for the labour market matching models). The characterization of the equilibrium through two main variables simplifies the analysis and allows using the theoretical model for empirical purposes, namely, the real estate appraisals. Design/methodology/approach – This work is both theoretical and empirical. Theoretically, a long-run equilibrium model with a positive share of vacant houses and home seekers is determined along with price and market tightness. Also, the conditions of existence and uniqueness of the steady-state equilibrium are determined. Unlike most of the search-and-matching models in the housing literature, the out-of-the steady-state dynamics are also analyzed to show the stability of the equilibrium. Empirically, to show the usefulness of the theoretical model, a numerical simulation is performed. By using two readily available housing market data – the expected time on the market and the average number of trades – it is possible to determine the key variables of the model: price, market tightness and matching opportunities for both buyers and sellers. Although the numerical simulation concerns the Italian housing market, the proposed model is generally valid, being empirically applicable to all real estate markets characterized by non-negligible trading frictions. Indeed, the proposed model can be used to compare housing markets with different features (concerning the search and matching process), as well as analyse the same housing market in different time periods (because the efficiency of the search and matching process can change). Findings – Several important results are obtained. First, the price adjustment – i.e. the difference between the actual selling price and the price obtained in an ideal situation of frictionless housing market – is remarkable. This means that the sign and the size of the price adjustment depend on the extent of trading frictions in the housing market. Precisely, the higher the trading frictions on the demand side (more buyers and less sellers), the higher the actual selling price (the price adjustment is positive), whereas the higher the trading frictions on the supply side (less buyers and more sellers), the lower the actual selling price (the price adjustment is negative). Accordingly, the real estate appraisers should assess the trading frictions in the housing market before determining the price adjustment. Second, an increase in the number of trades affects the house price only if the time on the market varies. Also, the higher the variation in the time on the market, the larger the house price adjustment. Indeed, the expected time on the market reflects the opportunities to matching for both parties and thus the trading frictions. If the time on the market increases (decreases), the seller will receive less (more) opportunities to match; thus, the actual selling price will be driven downwards (upwards). Originality/value – As far as the authors are aware, none of the existing works in the search and matching literature has considered how to take advantage of this theoretical approach to estimate the house price in the presence of trading frictions in the housing market. Indeed, the proposed theoretical model may be a useful tool for real estate appraisers, as it is able to derive the trading frictions from the time on the market and the number of trades, thus estimating properly the house price.

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