scholarly journals Asymmetric Demand Response When Prices Increase and Decrease: The Case of Child Healthcare

2021 ◽  
pp. 1-30
Author(s):  
Toshiaki Iizuka ◽  
Hitoshi Shigeoka
Keyword(s):  
Demand Response ◽  
Price Change ◽  
Welfare Analysis ◽  
Rapid Expansion ◽  
Difference In Differences ◽  
Price Increases ◽  
Demand Theory ◽  
Change Direction ◽  
Child Healthcare

Abstract This study tests whether demand responds symmetrically to price increases and decreases—a seemingly obvious proposition under conventional demand theory that has not been rigorously tested. Exploiting the rapid expansion in Japanese municipal subsidies for child healthcare in a difference-in-differences framework, we find evidence against conventional demand theory: when coinsurance, our price measure, increases from 0% to 30%, the demand response is more than twice that to a price decrease from 30% to 0%. This result indicates that while economists and policymakers pay little attention, price change direction matters and should be incorporated into welfare analysis.

scholarly journals The effects of tourism on housing prices: applying a difference-in-differences methodology to the Portuguese market

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
António Manuel Cunha ◽  
Júlio Lobão
Keyword(s):  
Real Estate ◽  
Housing Prices ◽  
Housing Price ◽  
Generalized Least Squares ◽  
Equation Model ◽  
Seemingly Unrelated Regression ◽  
Housing Supply ◽  
Difference In Differences ◽  
Content Type ◽  
Price Increases

Purpose This paper aims to explore the effects of a surge in tourism short-term rentals (STR) on housing prices in municipalities within Portugal’s two largest Metropolitan Statistical Areas. Design/methodology/approach This study applies the difference-in-differences (DiD) methodology by using a feasible generalized least squares (FGLS) estimator in a seemingly unrelated regression (SUR) equation model. Findings The results show that the liberalization of STR had a significant impact on housing prices in municipalities where a higher percentage of housing was transferred to tourism. This transfer led to a leftward shift in the housing supply and a consequent increase in housing prices. These price increases are much higher than those found in previous studies on the same subject. The authors also found that municipalities with more STR had low housing elasticities, which indicates that adjustments to the transfer of real estate from housing to tourism were made by increasing house prices, and not by increasing supply quantities. Practical implications The study suggests that an unforeseen consequence of allowing property owners to transfer the use of real estate from housing to other services (namely, tourism) was extreme housing price increases due to inelastic housing supply. Originality/value This is the first time that the DiD methodology has been applied in real estate markets using FGLS in a SUR equation model and the authors show that it produces more precise estimates than the baseline OLS FE. The authors also find evidence of a supply shock provoked by STR.

Demand Estimation Using Managerial Responses to Automated Price Recommendations

2022 ◽  
Author(s):  
Daniel Garcia ◽  
Juha Tolvanen ◽  
Alexander K. Wagner
Keyword(s):  
Control Function ◽  
Price Change ◽  
Decision Makers ◽  
Function Approach ◽  
Difference In Differences ◽  
Price Variation ◽  
Data Set ◽  
Demand Elasticities ◽  
Price Adjustments ◽  
Control Function Approach

We provide a new framework to identify demand elasticities in markets where managers rely on algorithmic recommendations for price setting and apply it to a data set containing bookings for a sample of midsized hotels in Europe. Using nonbinding algorithmic price recommendations and observed delay in price adjustments by decision makers, we demonstrate that a control-function approach, combined with state-of-the-art model-selection techniques, can be used to isolate exogenous price variation and identify demand elasticities across hotel room types and over time. We confirm these elasticity estimates with a difference-in-differences approach that leverages the same delays in price adjustments by decision makers. However, the difference-in-differences estimates are more noisy and only yield consistent estimates if data are pooled across hotels. We then apply our control-function approach to two classic questions in the dynamic pricing literature: the evolution of price elasticity of demand over and the effects of a transitory price change on future demand due to the presence of strategic buyers. Finally, we discuss how our empirical framework can be applied directly to other decision-making situations in which recommendation systems are used. This paper was accepted by Omar Besbes, revenue management and market analytics.

scholarly journals Finance, gender, and entrepreneurship: India’s informal sector firms

2020 ◽  
Author(s):  
Ira N. Gang ◽  
Rajesh Raj Natarajan ◽  
Kunal Sen
Keyword(s):  
Informal Sector ◽  
Economic Activity ◽  
National Sample ◽  
Conclusive Evidence ◽  
Financial Inclusion ◽  
Rapid Expansion ◽  
Sample Survey ◽  
Difference In Differences ◽  
Alternative Measures

How does informal economic activity respond to increased financial inclusion? Does it become more entrepreneurial? Does access to new financing options change the gender configuration of informal economic activity and, if so, in what ways and what directions? We take advantage of nationwide data collected in 2010/11 and 2015/16 by India’s National Sample Survey Office on unorganized (informal) enterprises. This period was one of rapid expansion of banking availability aimed particularly at the unbanked, under-banked, and women. We find strong empirical evidence supporting the crucial role of financial access in promoting entrepreneurship among informal sector firms in India. Our results are robust to alternative specifications and alternative measures of financial constraints using an approach combining propensity score matching and difference-in-differences. However, we do not find conclusive evidence that increased financial inclusion leads to a higher likelihood of women becoming entrepreneurs than men in the informal sector.

scholarly journals Measuring Voluntary Responses in Healthcare Utilization During and After COVID-19 Pandemic: Evidence from Taiwan

2021 ◽  
Author(s):  
Yung-Yu Tsai ◽  
Yang Tzu-Ting
Keyword(s):  
Infectious Diseases ◽  
Healthcare Utilization ◽  
Demand Response ◽  
Human Mobility ◽  
Healthcare Services ◽  
Prevention Measures ◽  
Difference In Differences ◽  
Related Services ◽  
Side Constraints ◽  
Substantial Decline

Abstract Healthcare has been one of the most affected sectors during the coronavirus disease 2019 (COVID-19) pandemic. The utilization of related services for non-COVID-19 diseases fell dramatically following the point at which the virus broke out; however, little is known about whether this observed decline in healthcare use was due to voluntary behaviors or enforced measures. This paper quantifies the spontaneous change in healthcare utilization during and after the pandemic. We utilize a county-by-week-level dataset from Taiwan's National Health Insurance (NHI) record, covering the entire Taiwanese population, and a difference-in-differences design. Our results indicate that even if there were no human mobility restrictions or supply-side constraints, people voluntarily reduced their demand for healthcare, due to fears of contagion, or COVID-related precautionary behaviors. We find that the number of outpatient visits (inpatient admissions) decreased by 21% (11%) during the pandemic period (February to May 2020). Furthermore, the demand response of healthcare for infectious diseases (e.g., flu) was much greater and more persistent than for non-infectious diseases, thereby suggesting that the substantial decline in accessing healthcare was induced by positive public health externality of prevention measures for COVID-19. Finally, we find that the demand for healthcare services did not get back to the pre-pandemic baseline, even when there were no local coronavirus cases for 253 consecutive days (mid-April to December 2020) in Taiwan.

An economic welfare analysis of demand response in the PJM electricity market

Energy Policy ◽  
2008 ◽  
Vol 36 (10) ◽  
pp. 3692-3702 ◽  
Author(s):  
Rahul Walawalkar ◽  
Seth Blumsack ◽  
Jay Apt ◽  
Stephen Fernands
Keyword(s):  
Demand Response ◽  
Electricity Market ◽  
Welfare Analysis ◽  
Economic Welfare

Abstract P062: The Effect of Food Pricing on Dietary Behaviors and Adiposity: a Systematic Review and Meta-analysis

Circulation ◽  
2014 ◽  
Vol 129 (suppl_1) ◽  
Author(s):  
Ashkan Afshin ◽  
Liana Del Gobbo ◽  
Jose Silva ◽  
Melody Michaelson ◽  
Dariush Mozaffarian
Keyword(s):  
Fast Food ◽  
Fruits And Vegetables ◽  
Meta Analysis ◽  
Price Change ◽  
Experimental Studies ◽  
Dietary Behaviors ◽  
Cochrane Library ◽  
Cross Sectional ◽  
Price Increases ◽  
Quasi Experimental

Background: While food pricing is a promising strategy to improve diet and reduce cardiometabolic disease, most prior evidence comes from cross-sectional price elasticity estimates. The prospective impact of food pricing on dietary behaviors and obesity has not been systematically evaluated. Objective: To systematically investigate and quantify the effect of price change on dietary intake and on adiposity, as well as whether other underlying factors alter these effects. Methods: Using MOOSE and PRISMA guidelines, we systematically searched PubMed, Embase, EconLit, OVID, Cochrane library, Web of Knowledge, and CINHAL for prospective observational or interventional studies of price differences and diet (foods, drinks, energy) or adiposity. Studies were excluded if cross-sectional; price data collected before 1990; or reporting only crude risk estimates. Data were extracted independently and in duplicate. Findings were pooled using inverse-variance meta-analysis Results: From 2,299 identified abstracts, 21 met inclusions. These included 6 randomized trials and 7 quasi-experimental studies in different settings (supermarket, school/workplace cafeteria, restaurant) in 3 countries (US, New Zealand, Netherland); and 8 observational studies mostly using nationally representative US data. Studies evaluated effects of increase (n=10, 1-35% increase) in price (fast food, energy dense snacks, soda) and decrease (n=11, 10-50% decrease) in price (fruits, vegetables, low fat/calorie products) among adults (n=13) and children (n=8). Studies consistently showed that price increases led to decreased consumption; effects of price decreases on consumption and price increases/decreases on BMI were less consistent. A mean $0.43/serving (12 oz) increase in price of soda was associated with 2.77 servings/wk lower consumption (95% CI: 1.58. 3.96, n=4 studies). A mean %30/serving decrease in price of fruits and vegetables was not significantly associated with consumption (+536 g/d, 95% CI: -427, 1500, n=2 studies). High between study heterogeneity was evident for price increase and soda intake and price discount and fruit intake. Conclusions: These prospective results support taxation to reduce soda intake. More evidence from prospective studies and trials is needed on food pricing and other dietary outcomes and adiposity.

scholarly journals Patterns and Determinants of Price Changes: Analysing Individual Consumer Prices in Austria

2011 ◽  
Vol 12 (3) ◽  
pp. 336-350 ◽  
Author(s):  
Fabio Rumler ◽  
Alfred Stiglbauer ◽  
Josef Baumgartner
Keyword(s):  
Price Change ◽  
Consumer Price Index ◽  
Probit Model ◽  
Average Frequency ◽  
Price Changes ◽  
Price Increases ◽  
Price Adjustments ◽  
Consumer Prices ◽  
The Mean ◽  
Positive Effect

Abstract We provide empirical evidence on the degree and characteristics of price stickiness in Austria by estimating the average frequency of price changes and the duration of price spells from a large dataset of individual price records collected for the computation of the Austrian consumer price index. The mean (median) duration of price spells in Austria amounts to 14 (11) months, but there is considerable heterogeneity across sectors and products. We find that price increases occur only slightly more often than price decreases. For both directions, the average magnitude of price changes is quite large (11% and 14%, respectively). The introduction of the euro cash in January 2002 led to more frequent but, on average, smaller price adjustments than usual. Estimating the probability of a price change in a panel probit model, we find a small but positive effect of the price spell duration on the incidence of price changes. Furthermore, product-specific inflation, the size and the sign of the last price change and the period of the euro introduction significantly affect the probability of a price change.

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