Auto Purchases Research Articles

Research of the influence of automobile purchase restriction policy on the pricing of motor vehicles in judicial appraisal enterprises

PurposeThe purpose of this paper is to take second-hand vehicles at judicial auctions in China as the primary research direction and to explore the impact of purchasing restriction policy and city size on the relationship between the appraisal price and transaction price of second-hand motor vehicles in the context of auto purchase restriction in China from a microscopic angle. It attempts to broaden the pricing ideas of judicial appraisal enterprises in providing appraisal prices of second-hand motor vehicles and to put forward suggestions for the optimization of appraisal prices and appraisal standards of judicial appraisal enterprises.Design/methodology/approachWith the help of Python, this paper crawls 59,038 lines of valid data from three leading internet judicial auction platforms, namely “Ali Auction,” “China Beijing Equity Exchange” and “Gong Pai Wang,” as research samples. Besides, this paper forms a database containing judicial auction used car appraisal prices, transaction prices, motor vehicle purchase restrictions and whether the motor vehicle carries a license plate. By constructing a multiple regression model, the impact of automobile purchase restriction policy on the price of motor vehicles appraised by judicial appraisal enterprises is investigated.FindingsWith the help of the multivariate regression model, it found that under the same condition, the city where the auction took place implemented the automobile purchase restriction before the end of the auction. The court has specified that the buyer could directly obtain the license plate after the auction. The transaction price and the evaluation price ratio will be statistically larger, which proves that the license plate has an evident value in the transaction and is traded as subject matter by the residents, and consequently brings a higher premium to the price of automobile transaction in internet judicial auction. Meanwhile, the purchase restriction policy in the first-tier cities has resulted in a significant premium on automobile license plates, which is much higher than the automobile license plate premium level in non-first-tier cities under the same conditions.Social implicationsCar ownership continues to rise with rapid economic development worldwide. Control the growth of car ownership, some countries and regions mainly restrict the issuance of motor vehicle license plates, which indirectly leads to vehicle license plate indicators becoming a scarce resource. National laws permit judicial auction as a means for the people's courts to settle creditors' claims in enforcement procedures of civil cases. In the judicial auction process, the People's Court introduces third-party evaluation enterprises to appraise, assess and audit the subject and obtain the appraisal price, which guides the bidding behavior of used car buyers and indirectly affects the transaction price of used cars.Originality/valueAs the only subject capable of assessing the value of used cars at judicial auctions, judicial appraisal enterprises have received widespread attention for their appraisal results. This paper researches this field by screening the factors affecting the ratio of motor vehicle transaction price to the appraised price. It also analyzes how the ratio of motor vehicle transaction price to appraised price is affected by motor vehicle purchase restrictions and the situation with license plates. This paper examines the existence of premiums for motor vehicle transactions with license plates, evaluates the purchase restrictions in cities with motor vehicle purchase restrictions and verifies that the premiums for motor vehicles at judicial auctions are affected by purchase restriction policies as well as the influence of city class. These studies have important implications for judicial appraisal enterprises to establish reasonable appraisal mechanisms and optimize appraisal prices. They also provide new ideas and methods for appraisal enterprises to assess the value of used vehicles at judicial auctions.

Regional Consumption Responses and the Aggregate Fiscal Multiplier

We use regional variation in the American Recovery and Reinvestment Act (2009-2012) to analyze the effect of government spending on consumer spending. Our consumption data come from household-level retail purchases in Nielsen and auto purchases from Equifax credit balances. We estimate that a $1 increase in county-level government spending increases consumer spending by $0.18. We translate the regional consumption responses to an aggregate fiscal multiplier using a multi-region, New Keynesian model with heterogeneous agents and incomplete markets. Our model successfully generates the estimated positive local multiplier, a result that distinguishes our incomplete markets model from models with complete markets. The aggregate consumption multiplier is 0.4, which implies an output multiplier higher than one. The aggregate consumption multiplier is almost twice the local estimate because trade linkages propagate government spending across regions.

Common and Contradictory Motivations in Buying Intentions for Green and Luxury Automobiles

Luxury is often blamed for creating social inequality and hampering sustainability, especially in the social and environmental realms. For instance, luxury goods entice people to conspicuous consumption that may result in showing off. However, study results show that luxury and environmental sustainability have common features. Notably, previous research mainly examined motivations for green purchases in general without relating to the specific product categories such as durables. Therefore, this study examines the relationship between these two—green and luxury automobile buying intentions—by analyzing the survey results of 1601 respondents relating to more than 60 nationalities. In contrast to a substantial effect on luxury buying intentions, perceived conspicuousness has no significant positive effect on green auto purchase intentions, and that price value has a limited influence compared with the effect on luxury automobile purchase intentions. Furthermore, hedonism has a less positive impact on green auto purchase intentions compared to its impact on luxury automobile buying intentions. The ‘extended self’ and the perception of high quality have been found to be drivers of luxury and green automobile purchase intentions, while unique value appears to have no impact on purchase intentions for green and conventional luxury automobiles. The present study contributes to the extant research by investigating common and contradictory motivations for luxury and green buying intentions of automobiles. Furthermore, it suggests a reconsideration of the traditional view that luxury and environmental consumption are inconsistent and contradictory concepts. The complementary managerial implications of this study guide practitioners in positioning the situatable variants of their automobiles as ethical luxury.

Auto purchase order system between retailer and distributor

Uncertainty of goods inventory often triggers the occurrence of Bullwhip Effect, where there is accumulation of goods on a stage or lack of goods at another stage in the supply chain. Bullwhip Effect is caused by an error in ordering the amount of goods, error in the time of ordering or delivery of goods. The problem can be solved using information sharing. This research utilizing information sharing between two retailers and one distributors used for the ordering process of goods. The process of ordering goods retailers to distributors is done automatically based on sales data retailers. The order quantity is calculated based on the final stock and the maximum stock value of the goods.

Regional Consumption Responses and the Aggregate Fiscal Multiplier

We use regional variation in the American Recovery and Reinvestment Act (2009-2012) to analyze the effect of government spending on consumer spending. Our consumption data come from household-level retail purchases in the Nielsen scanner data and auto purchases from Equifax credit balances. We estimate that a $1 increase in county-level government spending increases local non-durable consumer spending by $0.29 and local auto spending by $0.09. We translate the regional consumption responses to an aggregate fiscal multiplier using a multiregional, New Keynesian model with heterogeneous agents, incomplete markets, and trade linkages. Our model is consistent with the estimated positive local multiplier, a result that distinguishes our incomplete markets model from models with complete markets. At the zero lower bound, the aggregate consumption multiplier is twice as large as the local multiplier because trade linkages propagate the effect of government spending across regions.

Regional Consumption Responses and the Aggregate Fiscal Multiplier

We use regional variation in the American Recovery and Reinvestment Act (2009-2012) to analyze the effect of government spending on consumer spending. Our consumption data come from household-level retail purchases in Nielsen and auto purchases from Equifax credit balances. We estimate that a $1 increase in county-level government spending increases consumer spending by $0.18. We translate the regional consumption responses to an aggregate fiscal multiplier using a multi-region, New Keynesian model with heterogeneous agents and incomplete markets. Our model successfully generates the estimated positive local multiplier, a result that distinguishes our incomplete markets model from models with complete markets. The aggregate consumption multiplier is 0.4, which implies an output multiplier higher than one. The aggregate consumption multiplier is almost twice the local estimate because trade linkages propagate government spending across regions.

Research on constructing urban green traffic system: the case of Shenzhen City

Traffic jam is a big problem, which influences people's normal travel, and causes environmental pollution. Green traffic can solve traffic problem effectively. By analysing the factors that affect traffic jams, the article builds cause-and-effect relation diagram and then builds stock-flow diagram. Then taking Shenzhen city as an example, make a simulation of the urban green traffic model system. The result shows that the number of private cars ownership and the increase of vehicle exhaust stock are important driving factors of traffic congestion and environmental pollution. By influencing the total of the private cars ownership, auto purchase limit policy, restrictions and congestion pricing policy control motor vehicle trips, reduce vehicle emissions, and balance automobile exhaust gas pollution problem. At the same time, adopt new energy vehicle subsidy policy to advocate the residents to buy new energy vehicles and improve public transport infrastructure to advocate people to take public traffic vehicle.

Research on constructing urban green traffic system: the case of Shenzhen City

Traffic jam is a big problem, which influences people's normal travel, and causes environmental pollution. Green traffic can solve traffic problem effectively. By analysing the factors that affect traffic jams, the article builds cause-and-effect relation diagram and then builds stock-flow diagram. Then taking Shenzhen city as an example, make a simulation of the urban green traffic model system. The result shows that the number of private cars ownership and the increase of vehicle exhaust stock are important driving factors of traffic congestion and environmental pollution. By influencing the total of the private cars ownership, auto purchase limit policy, restrictions and congestion pricing policy control motor vehicle trips, reduce vehicle emissions, and balance automobile exhaust gas pollution problem. At the same time, adopt new energy vehicle subsidy policy to advocate the residents to buy new energy vehicles and improve public transport infrastructure to advocate people to take public traffic vehicle.

Mortgage Rates, Household Balance Sheets, and the Real Economy

This paper investigates the impact of lower mortgage rates on household balance sheets and other economic outcomes during the housing crisis. We use proprietary loan-level panel data matched to consumer credit records using borrowers' Social Security numbers, which allows for accurate measurement of the effects. Our main focus is on borrowers with agency loans, which constitute the vast majority of U.S. mortgage borrowers. Relying on variation in the timing of resets of adjustable rate mortgages, we find that a sizable decline in mortgage payments ($150 per month on average) induces a significant drop in mortgage defaults, an increase in new financing of durable consumption (auto purchases) of more than 10% in relative terms, and an overall improvement in household credit standing. New financing of durable consumption by borrowers with lower housing wealth responds more to mortgage payment reduction relative to wealthier households. Credit-constrained households initially use more than 70% of the extra liquidity generated by mortgage rate reductions to repay credit card debt-- a deleveraging response that can significantly restrict the ability of monetary policy to stimulate these households' consumption. These findings also qualitatively hold in a sample of less-prevalent borrowers with private non-agency loans. We then use regional variation in mortgage contract types to explore the impact of lower mortgage rates on broader economic outcomes. Regions more exposed to mortgage rate declines saw a relatively faster recovery in house prices, increased durable (auto) consumption, and increased employment growth, with responses concentrated in the non-tradable sector. Our findings have implications for the pass-through of monetary policy to the real economy through mortgage contracts and household balance sheets.

Auto Sector Impacts of a Canada-Japan Free Trade Agreement: A Market-Segment-Based Evaluation

With the recent completion of a second Joint Study regarding a Canada-Japan Free Trade Agreement, and Canada’s entry into the Trans-Pacific Partnership negotiations, which may eventually include Japan, the implications of trade liberalization with Asian economies gains renewed interest, in particular the implications for Canada’s auto sector, which has been a stumbling block in previous negotiations. This paper considers the implications of auto sector liberalization between Canada and Japan. The impacts are modest for three main reasons: the export-orientation of Canada’s auto sector, the fact that auto manufacturers price strategically, often practicing “pricing to market” (PTM) and so do not automatically pass on tariff cuts to consumers, and the impact of tariff cuts at the border is muted by the large share of domestic transport and distribution costs in the final consumer price. Taking into account the segmented nature of the auto sector tends to amplify rather than reduce the scale of the effects on the Canadian industry, suggesting that there is some degree of aggregation bias in analyses that treat the sector in aggregated terms. Income effects from the overall CJFTA would be expected to be channelled in part into increased auto purchases, providing a sizeable offset to the direct negative trade effects. Based on previous estimates of income gains from a CJFTA, this would reduce the negative impacts on Canadian production by half.

The Effects of Fiscal Stimulus: Evidence from the 2009 Cash for Clunkers Program*

Abstract We evaluate the impact of the 2009 Cash for Clunkers program on short- and medium-run auto purchases. Our empirical strategy exploits variation across U.S. cities in ex ante exposure to the program as measured by the number of “clunkers” in the city as of summer 2008. We find that the program induced the purchase of an additional 370,000 cars in July and August 2009. However, we find strong evidence of reversal; high clunker counties bought fewer autos in the 10 months after the program expired, which offset most of the initial purchases. We find no evidence of an effect on employment, house prices, or household default rates in cities with higher exposure to the program.

The Effects of Fiscal Stimulus: Evidence from the 2009 ‘Cash for Clunkers’ Program

A key rationale for fiscal stimulus is to boost consumption when aggregate demand is perceived to be inefficiently low. We examine the ability of the government to increase consumption by evaluating the impact of the 2009 “Cash for Clunkers” program on short and medium run auto purchases. Our empirical strategy exploits variation across U.S. cities in ex-ante exposure to the program as measured by the number of “clunkers” in the city as of the summer of 2008. We find that the program induced the purchase of an additional 360,000 cars in July and August of 2009. However, almost all of the additional purchases under the program were pulled forward from the very near future; the effect of the program on auto purchases is almost completely reversed by as early as March 2010 – only seven months after the program ended. The effect of the program on auto purchases was significantly more short-lived than previously suggested. We also find no evidence of an effect on employment, house prices, or household default rates in cities with higher exposure to the program.

Impact of Carsharing on Household Vehicle Holdings

Carsharing has grown considerably in North America during the past decade and has flourished in metropolitan regions across the United States and Canada. The new transportation landscape offers urban residents an alternative to automobility, one without car ownership. As car-sharing has expanded, there has been a growing demand to understand its environmental effects. This paper presents the results of a North American carsharing member survey (N = 6,281). A before-and-after analytical design is established with a focus on carsharing's effects on household vehicle holdings and the aggregate vehicle population. The results show that carsharing members reduce their vehicle holdings to a degree that is statistically significant. The average number of vehicles per household of the sample drops from 0.47 to 0.24. Most of this shift constitutes one-car households becoming carless. The average fuel economy of carsharing vehicles used most often by respondents is 10 mi/gal more efficient than the average vehicle shed by respondents. The median age of vehicles shed by carsharing households is 11 years, but the distribution covers a considerable range. An aggregate analysis suggests that carsharing has taken between 90,000 and 130,000 vehicles off the road. This equates to 9 to 13 vehicles (including shed autos and postponed auto purchases) taken off the road for each carsharing vehicle.

Gender roles and family decision making: a study of Indian automobile purchases

Marketers have traditionally used gender to segment markets. Due to socially prescribed gender roles some products are thought more suitable to target women, while others more suitable to males. For example, automobiles have been traditionally targeted towards males, assuming that it would be males who would be the influencers and deciders in the auto purchase decision. However, the recent past has seen a blurring of gender roles. More and more women are receiving college degrees and a large number of households have two wage earners – with the woman out-earning the male in a growing number of households. As the gender roles are changing in society, it is time to re-examine gender roles in purchase decisions, particularly with respect to automobiles – a traditionally male area. This study examines family decision-making roles involved in automobile purchases at four dealerships in Mumbai, India. The study examines the effect of age, education and income contribution on gender roles in the purchase decision. Findings show that among the younger better educated consumers, the wife's influence is more pronounced.

How Do Gasoline Prices Affect Fleet Fuel Economy?

Exploiting a rich dataset of passenger vehicle registrations in 20 US MSAs from 1997 to 2005, we examine the effects of gasoline prices on the automotive fleet's composition. We find that high gasoline prices affect fleet fuel economy through two channels: shifting new auto purchases towards more fuel-efficient vehicles, and speeding the scrappage of older, less fuel-efficient used vehicles. Policy simulations suggest that a 10 percent increase in gasoline prices from 2005 levels will generate a 0.22 percent increase in fleet fuel economy in the short run and a 2.04 percent increase in the long run. (JEL H25, L11, L69, L71)

Statistical Demand Functions for Automobiles and Their Use for Forecasting in an Energy Crisis

A research study in 1976 by one of the authors (Carlson 1978) investigated automobile demand over the period 1965-75 using a disaggregate approach. Previous studies by Chow (1957), Nerlove (1957), Suits (1958), Smith (1975)1 and others had explained auto purchase by aggregating all sizes and classes of automobile into one demand function. The 1976 study suggested that as little aggregation as possible is desirable in a model of the new car market and that automobile demand segmented into the five automobile classifications-subcompact, compact, intermediate, standard, and luxury-revealed much additional information. While the purpose of this earlier study was model building (with emphasis on computing elasticities and demonstrating a practical application of seemingly unrelated regression) and not forecasting, the implications for future demand were discussed, and the tentative forecasts made were quite accurate. The model forecast 1977 sales at 10.3 million, 1978 sales at 10.7 million, and 1979 sales at less than 11.0 million. Actual new car sales for 1977 and 1978 were 10.7 and 10.9 million cars, respectively, with 1979 sales projected around 11 million. One test for model validity is its ultimate forecasting ability, This research is an addendum to Seemingly Unrelated Regression and the Demand for Automobiles of Different Sizes, 1965-75: A Disaggregate Approach, published by the Journal of Business in April 1978. The purpose of this additional study on automobile demand is (1) to point out the forecasting accuracy of the market segmentation approach and (2) to estimate the effects of the energy crisis on automobile demand for the years 1979-83. While this paper presents no additional theory on the topic, it is felt that these forecasts are of considerable interest in light of the importance of the auto industry to the nation's economy.