The question of whether higherlifetime income households save a larger fraction of their income was the subject of much debate in the 1950s and 1960s, and while not resolved, it remains central to the evaluation of tax and macroeconomic policies. We resolve this long-standing question using new empirical methods applied to the Panel Study of Income Dynamics, the Survey of Consumer Finances, and the Consumer Expenditure Survey.
Motivation research distinguishes two types of goals: (a) ideals, which relate to people's hopes, wishes, and aspirations, and (b) oughts, which relate to people's duties, obligations, and responsibilities. We propose that, in persuasion, the accessibility of ideals increases consumers' reliance on their subjective affective responses to the ad relative to the substance of the message, whereas the accessibility of oughts increases consumers' reliance on the substance of the message relative to their subjective affective responses.
We address infinite-horizon models for oligopolies with competing retailers under demand uncertainty. We characterize the equilibrium behavior which arises under simple wholesale pricing schemes. More specifically, we consider a periodic review, infinite-horizon model for a two-echelon system with a single supplier servicing a network of competing retailers. In every period, each retailer faces a random demand volume, the distribution of which depends on his own retail price as well as those charged by possibly all competing retailers.
It is increasingly apparent that the financial value of a firm depends on intangible assets (e.g., brands, customers, employees, knowledge) that are not on the balance sheet. In this paper, we focus on the most critical aspect of a firm—its customers. Specifically, we demonstrate how valuing customers makes it feasible to value firms, including high growth firms with negative earnings.
Product Management, 4th ed., by Lehmann and Winer is a defining text that covers three major tasks facing today's product mangers: analyzing the market, developing objectives and strategies for the product or service in question, and making decisions about price, advertising, promotion, channels of distribution and service. Product Management utilizes the familiar Marketing Plan as the unifying framework for its lessons, and takes a "hands-on" approach toward preparing graduates to assume the position of product manager.
Recommendations often play a positive role in the decision process by reducing the difficulty associated with choosing between options. However, in certain circumstances recommendations play a less positive and more undesirable role from the perspectives of both the recommending agent or agency and the person receiving the recommendation. Across a series of four studies, we explore consumer response when recommendations by experts and intelligent agents contradict the consumer's initial impressions of choice options.
We analyze an airline yield management problem on a single flight leg in which the buyers' choice of fare classes is modeled explicitly. The choice model we use is very general and includes a wide range of discrete choice models of practical interest. The optimization problem is to find, at each point in time, the optimal subset of fare classes to offer. We characterize the optimal policy for this problem exactly and show it has a surprisingly simple form.
This paper has three objectives. First, we develop an equilibrium pricing model in which consumers have incomplete information about both product qualities and prices. Specifically, manufacturers can use high prices to signal high quality to uninformed consumers. Furthermore, prices of any given brand can vary geographically across retail outlets. We show that previous models are special cases of our model. Specifically, the hedonic regression model assumes that consumers have full information about all product qualities and prices.
The telecommunications industry is a fragmented market, characterized by a tremendous amount of customer heterogeneity. This paper shows how such customer heterogeneity dramatically affects nonlinear pricing strategies: (i) First, if there are unbalanced calling patterns between different customer types, networks make larger profits on the least attractive customers. In addition, the nature of the calling pattern substantially affects how networks discriminate implicitly between different customer types.