Buyer's Market Research Articles

Variation in Bid-Rigging Cartels’ Overcharges: An Exploratory Study

Empirical examinations into the determinants of cartel overcharges are limited in the economic literature on collusion. We review the literature and perform a meta-analysis model of overcharges using data on 112 contemporary, penalized bid-rigging episodes over 27 years. We find that the price effects of bidding rings, controlling for industry fixed effects, are affected by buyer market concentration, seller industry concentration, and two temporal features (episodic duration and recessions during collusion).

The Role of Product and Market Information in an Online Marketplace

Although the online marketplaces have flourished, the role of product and market information in how it affects an online marketplace and how it can be leveraged to improve the sales or sales volume of the platform has not been explored in the prior research. We study how the provision of product and/or market information affects buyers' and sellers' behavior in an online marketplace by establishing the (Pareto-dominant) equilibrium for the sellers' pricing decisions under various information structures. Our main findings are as followings. First, we show that in equilibrium while sales volume of the platform increases in both the size of the buyers' pool and the size of the sellers' pool, sales increase only in the size of the buyers' pool and are unimodal in the size of the sellers' pool. Second, by analytically characterizing the platform's optimal information strategy as a function of the underlying market parameters and whether the platform's goal is to maximize sales or sales volume, we find that providing product and/or market information may backfire on the platform by jeopardizing its financial performance. Third, we demonstrate using numerical studies that information is more valuable to the platform when the goal of the platform is to maximize sales rather than sales volume, and when it faces a seller's market (i.e., demand-to-supply ratio is greater than one) rather than a buyer's market (i.e., demand-to-supply ratio is less than one).

The impact of poverty, risk aversion and time preference on maize marketing channel choice decisions: the case of Zvimba and Makonde districts of Zimbabwe

ABSTRACTThe study deployed the experimental and behavioural economics toolkit to determine how risk aversion attitude, time preference and poverty status influenced farmers’ marketing channel preferences between the state-owned Grain Marketing Board (GMB) and the private buyer market. Following maize market deregulation and subsequent entry of private buyers in the Zimbabwean grain sector, marginalised poor farmers remained confined to the low return private buyer market that offered very low prices, as they avoided GMB whose payment plan was uncertain and delayed. The question therefore was: To what extent did farmers’ risk aversion attitude and time preference explain the poor farmers’ choice for low return private buyer market at the expense of the high return GMB market? Using survey data obtained from 433 maize farmers in Makonde and Zvimba districts, an instrumental variable probit regression model was estimated. The results confirmed that risk aversion attitude and time preferences (as measured by farmers’ discount rate) reduced the likelihood of a farmer participating in a high return state-owned GMB market. Poor farmers were found to be more risk averse and impatient than non-poor farmers in marketing channel selection. Their high risk aversion attitude and impatience constituted the greatest market impediments that restricted them to the low return private buyer market. To make agricultural markets work for poverty reduction the study recommended that policies that promote the development of risk transfer markets and futures markets for maturity transformation of farmers’ payments are critical in guaranteeing effective participation of poor households in high return markets.

The Relation among Brand Value, Relationship Value, Market Orientation and Performance in B2B

Purpose - The focus of this study is to investigate the structural influences such as brand value, relationship value, market orientation, long-term orientation, and performance. The effects of brand value and relationship value on the differences on transaction performance in b2b was investigated. Research design, data, and methodology - The subject of this study was a liquor and beverage distribution company that deals in b2b. The research hypothesis is based on literature of the preceding research analysis of brand value, relationship value, market orientation and long-term orientation. This study has constructs that was defined operationally by referencing previous studies. Operational questionnaire was used to investigate the target key staff who work in the liquor and beverage distribution company. 178 survey data were used for empirical analysis to prove the hypothesis. This study used structural equation techniques(AMOS) to prove the research hypothesis. Results - The main results of this empirical study were as follows. First, supplier's brand awareness has a positive effect on market orientation, but did not affect long-term orientation. Brand awareness of suppliers indicates that they are not directly related to long-term orientation. Second, supplier's brand image has a positive effect on market orientation and long-term orientation in b2b transaction. So, the brand image and reputation of the supplier suggest that it is important for the b2b transaction to have a market orientation tendency or a long-term orientation. Third, supplier's relationship value has a positive effect on long-term orientation, but does not affect market orientation. Relationship value indicates that they are not directly related to market orientations of the buyer. Fourth, Market orientation has a positive effect on long-term orientation and marketing performance and long-term orientation has a positive effect on marketing performance in b2b. Additionally, the buyers market and long term orientation are important factors in marketing performance in b2b. ' Conclusions - Based on empirical results, this study confirmed that brand image rather than brand awareness positively influenced long-term orientation as well as market orientation in b2b. Relationship value can be found in transactions, which is important for long-term orientation. Especially, these findings are suggestive in the consumer goods distribution market.

Buy and Hold in the New Age of Stock Market Volatility: A Story about ETFs

The buy and hold stock market strategy, which gained tremendous popularity in the 1970s, may no longer be such a profitable method for accumulating wealth for the average investor in the new millennium. This paper investigates the relationship between compound return and holding period length to see how long an Exchange Traded Fund (ETF) investment must be held before a positive return on principal is 100% likely. Because the ETF is a relatively new investment vehicle that could be considered particularly well-suited to the requirements of the buy and hold strategy, we begin our investigation here. We find that the compound returns earned over a rolling holding period are much more volatile than one might assume given historic rules of thumb for average return expectations. Using monthly return data for all listed NASDAQ ETFs between their date of inception and 2015, we find it takes ten years for the average probability of a gain on principal to be over 95 percent.

Capacity Sharing Between Competitors

Market competition may lead to mismatch between supply and demand. That is, overpricing may give rise to underselling, and underpricing may yield stockout. Capacity sharing is a common practice to align excessive capacity with excessive demand. Yet, the strategic interaction between competition and capacity sharing has not been adequately addressed. In this paper, we investigate optimal strategies and firm profitability of capacity sharing between competing firms under both ex ante and ex post contracting, depending on whether the capacity-sharing price is determined before or after price setting in the buyer market. We show that, with symmetric capacity, committing to an overly high capacity-sharing price may not necessarily improve firm payoffs. Capacity sharing softens price competition under either contracting scheme, whereas the optimal capacity-transfer price and equilibrium profits may be nonmonotonically influenced by buyer loyalty. The equilibrium outcome under ex ante contracting is more sensitive to variations in market parameters than ex post contracting. As a result, ex ante contracting is more likely to be preferred when the endowed capacity is low or buyer loyalty is high. However, when firms’ capacity is asymmetric, capacity sharing may intensify equilibrium competition and hurt firm profitability through reversing the firms’ relative pricing aggressiveness. The supplementary appendix is available at https://doi.org/10.1287/mnsc.2017.2796 . This paper was accepted by Eric Anderson, marketing.

Examining the Role of Online Reviews in Chinese Online Group Buying Context: The Moderating Effect of Promotional Marketing

Given the rapid growth of online group buying (OGB) market in China, this study was designed to examine the influencing mechanism of online reviews on Chinese consumers’ purchase intention in OGB context. A comprehensive model was developed based on technology acceptance model (TAM) and information adoption model (IAM). The construct named overall reviews was included in the research framework along with the variables from TAM and IAM. Promotional marketing (PM) was expected to play a moderating role between online reviews and consumers’ purchase intention. A quantitative study was conducted, and data were collected using a survey. To test the conceptual model’s hypotheses, Amos 18.0 was applied to estimate the structural equation model (SEM). The results indicate that review quality and reviewer characteristics have significant relationships with consumers’ perceived credibility and usefulness of an online review, which in turn to influence their purchase intention. Overall reviews proposed in this study also have significant effects on purchase intention. Furthermore, low-interest promotional marketing group act more rational purchase behavior than high group. Specific practical and theoretical implications and study limitations are discussed based on the results.

Analysis of consumers’ attitudinal and emotional factors on luxury apparel brand purchase intentions

ABSTRACTThis study advances both descriptive and managerial research addressing foreign consumers’ attitudinal, attributional and emotional valuations of brand equity for a U.S.-based global luxury brand. Taiwan was selected as the focal population of interest because this foreign market is distinguished by high market penetration and consumer awareness of global apparel brands. Consistent with a call for additional research on this topic, the present study employed both qualitative and quantitative research methods to empirically assess the relationship of foreign consumers’ brand awareness, attitudinal and emotional factors with the ensuing purchase intentions. Notably, customers’ level of price sensitivity is also included in the model, and the empirical findings reveal that price sensitivity negatively influences purchase intentions. The results also suggest that consumers’ susceptibility for perceived quality has a positive influence on purchase intentions for the U.S. apparel brand through emotional value. The takeaway for marketers in the luxury apparel industry is to increase the brand value in the customers’ mind to offset the likely negative effect of consumer price sensitivity. In addition, fashion brand managers could consider penetrating the brand-sensitive buyer’s market with a popular name brand and try to exploit the brand-insensitive buyer market with a generic apparel brand.

On the effect of aggregate uncertainty on certification intermediaries’ incentives to distort ratings

We analyze a certification intermediary’s incentives to distort ratings in a model with a monopolistic profit maximizing certification intermediary, a continuum of heterogeneous sellers, and a competitive market of risk-neutral buyers. The value of a seller’s good is known to the seller and observable by the certifier, but not by buyers. Sellers can choose to get a rating. The certification intermediary can reveal a signal of arbitrary precision about the quality of the good. In contrast to the existing literature, we allow aggregate uncertainty. As in the existing literature, one rating class is optimal. However, the certification intermediary does not generally choose a socially optimal cutoff: the certifier is more likelyto be too lenient if the distribution of aggregate uncertainty has a lower mean, a higher variance, and is more left skewed. It is more likely to be too strict if the opposite holds.

The Catfish Fishing in the Amazon Floodplain Lakes

This study is about the spatial and temporal variability of the Hypophthalmus catfish fishery in the Amazonian floodplain lakes and the relationship among commercial CPUE, environmental and economic variables. The fishing productivity varies according to the fishing ground which varies due to the contribution of a set of variables. The most outstanding environmental variables are the Amazon River flow, the large-scale ENSO and GITA events. This catfish productivity was related to the dynamics of the hydrological cycle, ENSO events and economic factors in A“bidos, mainly with economic variables in SantarA©m and the dynamics of sea surface temperature, ENSO events and economic factors in Monte Alegre. Regarding this fishing profitability, the main economic factors are the distance to the nearest buyer market location and boat types – ice storage capacity and fuel required. The present study is a contribution to the development of a more sustainable small-scale fishery management policy for Amazon and other floodplain regions around the world. To monitor and deepen understanding of this resource fishing dynamics, we strongly encourage additional studies to offer long-term fishery data set, analyze the fishermen behaviour with changes in the exploitation form and intensity in the floodplain lakes, and address other essential data such as use of floodplain, local community, land and vegetation cover as well as landscape changes.

Risks and economic analysis of orange culture: case study of a producer from the interior of São Paulo State, Brazil

The Brazilian citriculture is one of the activities that generate the most income within the agrobusiness, being responsible for providing opportunities for thousands of direct and indirect workers, besides being a sector that moves a great amount of financial resources. The orange crop has been going through great price swings in the recent years, and with this, many farmers are failing to invest in potential, as a result of the risks involved in the activity. A large part of these risks is related to the buyer market, which is controlled by the large juice industries and by the high capital required for the implementation of the new orchards. The objective of this work is to identify the risk factors for attractiveness and to analyze the economic viability of the orange crop in a farm in the municipality of Bauru, in the state of São Paulo. For this, the Monte Carlo method be used to simulate the probabilities of success in the scenarios analyzed and the NPV, IRR and Payback to determine the feasibility of the project. The research is characterized as a case study. The results obtained showed that the investment is feasible, only in the real and optimistic scenario and will provide a return between the 6th and the 7th year of the project, providing a balance of approximately R$ 4,190,252.94 after 10 years of investment which represents an attractive compared to the initial investment value of R$ 937,500.00.

Tax distortions and bond issue pricing

Original issue premium (OIP) bonds are the norm in the US tax-exempt market but very rare in the taxable market. A tax subsidy helps explain this disparity. Unlike bonds issued at par or discount, the price of OIP bonds can fall and yet remain above par, providing secondary market buyers with more tax-exempt coupon and less taxable market discount gain. The subsidy for OIP bonds explains additional, previously undocumented empirical facts. In a calibration exercise, the subsidy’s expected cost to the U.S. Treasury is estimated at $1.7 billion per year.

Логістика інвестиційних процесів як фактор економічного аналізу

Висвітлено підходи до дискурсивного пізнання інвестиційної діяльності в контексті реформування вітчизняної економіки. Конкретизовано дефініції інвестицій та логістики для потреб дослідження розглядуваних феноменів у перехідній економіці. Виділено особливості логістичного потоку. Відповідно до сутності інформаційних та фінансових потоків визначено завдання кожного з елементів логістичної інвестиційної структури. Досліджено питому вагу та значення інвестиційної діяльності поміж іншими видами звичайної діяльності підприємства. Окреслено характерні риси інвестування та специфіку інвестування логістичної сфери. Визначено загальні засади дискурсивного пізнання економічних процесів, на основі яких було вдосконалено методику аналізу ефективності інвестиційних проектів. Аналіз ефективності інвестиційних операцій у кожного з учасників (інвестор, позичальник, ринок (покупець)) дає змогу визначити загальну ефективність в економічній системі. Запропоновано методику логістичного аналізу ефективності інвестиційних проектів. Визначено та обґрунтовано концептуальні підходи до аналізу ефективності інвестиційних проектів на засадах логістики та запропоновано концептуальну схему логістичного аналізу ефективності інвестиційного проекту.

Dark Net Market Buyers' Bible

Dark Net Market Buyers' Bible

Совершенствование cистемы управления транспортно-экспедиционного обслуживания мебельных предприятий

The purpose of this study is forwarding services, since at present transport largely determines the opportunities for development of national economies. The basic requirements on the market are the terms of delivery of goods: at the right time, in the right place, with certain consumer characteristics, in the required quantities. All this highlights the issue of freight forwarding service and choice of optimal method of delivery. In recent years, the latest practices and technologies for the delivery of goods, based on the method of integration of transport and logistics, on the development of the latest technologies in the field of informatics and communications, have been introduced into the economic practice of transport and forwarding enterprises and firms. As in other industries, the market for forwarding services has become a market for buyers. Therefore, it is extremely important for transport and forwarding enterprises to study and analyze the needs of society in all types of transport services in order to meet them. Thus, the successful operation of such enterprises is impossible without the active application of marketing research in their business processes. The modern freight transport market is characterized by a greater variety of forms of service. However, the reforms carried out in the country have not been lifted, but, rather, deepened the contradictions of a socio-economic nature. As a consequence, the problems of regulating transport activities are growing and becoming more complicated, as determined by such factors as insufficient attention of the state and local authorities to the problems of transport; lack of holistic coordination mechanism for management, combining elements of overall system management and operational regulation of transport. In a rapidly changing world, it is necessary to quickly respond to the constantly emerging new demands and requirements. This is especially true in the sphere of services. Therefore, transport and forwarding enterprises in order to remain successful and competitive need to effectively organize their activities and offer quality services.

The Economic Benefits of Generation Revenue and Demand Payment Assessment in Pool-based Market Model: The Case of Malaysia

In Malaysia, as the Power Purchased Agreement is coming toward the end, pool market model is recognized as a conceivable model to overcome the shortcomings of the single buyer market. However, there are issues on the welfare of the generators involved. In context of Malaysian Electricity Supply Industry, this paper proposes a model, a pool hybrid introducing the minimum capacity payment involving the efficiency of the generators and base load sharing approaches. Under single auction power pool, a case study is conducted for the generators in Peninsular Malaysia for an economic analysis to highlight the merits of the proposed model compared with other pool-based market models in terms of generation revenue and demand payment. The load demand curves, the details of the MW-installed capacity, energy prices, capacity prices, and efficiency of the generators are the parameters taken into account in carry out analysis on each generator revenue. Results have shown that pool hybrid market ensures the intermediate value of generation revenue with all Independent Power Producers participation even at the lowest demand and decreased the demand payment.

Supplier Development in a Multi-Tier Supply Chain

We examine how a buyer can use a full-control strategy and cost sharing to develop the sustainable quality capabilities of his tier-1 and tier-2 suppliers. In particular, we consider how the buyer's development decisions and the suppliers' sustainable quality decisions are impacted by consumers' demand sensitivity to sustainable quality and the division of the supply chain margin. Two quality-demand models are studied -- the overall quality of the supply chain equals either (i) the sum of or (ii) the minimum between the suppliers' quality levels. We find that when the suppliers' sustainable quality levels are additive, even if the low-margin supplier has a positive net profit return from improved quality, she may still choose to free ride on the high-margin supplier's quality investment. Interestingly, the buyer can cause the free riding with his cost-sharing decisions. When instead, the overall sustainable quality is determined by the minimum between the suppliers' quality levels, the buyer's strategy is often to focus only on developing the low-margin supplier. Nevertheless, when the buyer's market gain from improved quality is large and the suppliers' gains are comparable to one another, the buyer can justify sharing costs with both suppliers and raising the overall sustainable quality of the supply chain to a level neither supplier can achieve without development support.

Effect of Lifestyle on Consumer Decision Making: A Study of Women Consumer of Pakistan

To develop the understanding of consumer behavior is considered as an important element for the producers and marketing managers. The buying behavior of consumers is highly dependent on their lifestyle. This research strives to examine the effect of lifestyle on the female buying decisions. For this reason, 150 close ended questionnaires were distributed among the female buyers of Karachi followed by convenient sampling approach. Out of 150, 120 questionnaires were received for the further analysis. The sample portrays that majority of the women belong from the upper middle class. Most of them are working women and students and belong from the age group of 18 years to 50 years. The findings of the study highlights that majority of the women prefer to buy imported brands rather than local ones. In line with this, they prefer to go through the reviews regarding the newly launched brand before making any purchase. With respect to the findings, it is recommended that local producers should improve their quality so that they can capture the large market of female buyers.

Agent Intermediation and Racial Price Differentials

The key to identifying racial price differentials in housing markets is to test whether minority and non-minority buyers pay similar prices for comparable housing. The heterogeneous nature of the residential housing market and racial sorting of buyers into neighborhoods violates the comparability assumption. Previous studies attempt to address these concerns using a repeat-sales approach that controls for time-invariant attributes of the house and neighborhood. We provide evidence that the repeat-sales estimates reported in the extant literature suffer from an omitted variable bias traceable to time-varying attributes of the house. After controlling for the time-varying attributes using two distinct approaches, we find that minority and non-minority buyers pay a similar price for comparable housing.

Research on Korean Small and Medium Sized Component Manufacturing Enterprises’ International Competitiveness’ Enhancement under Korea-China FTA’s Effects

Korea has made China as a second domestic market, meanwhile ensured Korea’s economy new vitality and growth impetus by signing FTA with China. Some research predicts Korea’s GDP growth will add extra 0.92~1.25% by the effects of Korea-China FTA. This FTA is influencing all the enterprises in Korea. Korean small and medium-sized enterprises (SMEs) play an important role in Korea’s economic development, Technology innovation, balance of social and economic development, etc. Among these SMEs, small and medium-sized manufacturing enterprises (SMMEs) which take up 10.7% of all enterprises and 22.6% of all employees, SMMEs are Korea economy’s solid chassis. Korea-China FTA is influencing Korea’s SMEs international environment which thus changes their global competitiveness. Analyzing hydraulic cylinder enterprises case can help find advice for future competitiveness of Korean SMMEs’ future competitiveness which represents Korean’s economic competitiveness. This paper analyzed the International Environmental changes of Korea-China FTA’s Effects on Korean Small and Medium Sized Components Manufacturing Enterprises and tried to find suggestions to enhance international competitiveness for them. This paper promoted a case study of Korean hydraulic cylinder industry which is considered to be the representative of Korean component SMMEs. Then this paper made a survey to detect Korean hydraulic cylinder manufacturing enterprises’ basic conditions, import & export status, international environmental changes, major errors and current international competitiveness compared to national and international competitors. After the case study, the component SMMEs’ international competitiveness enhancement suggestions were deduced as follows: Firstly, Korean components SMMEs can enhance ‘China out-sourcing’ and ‘Korean out-sourcing’ to decrease their production cost. Secondly, Korean components SMMEs can enhance their differentiation advantages such as diverse small-quantity production to maintain national market and block international competitors meanwhile looking for potential foreign buyers. Thirdly, Korean components SMMEs can enhance their production management technologies, Know-how technologies, and R&D technologies, and then chalk out new ideas and programs to improve the competitiveness. Fourthly, Korean components SMMEs should avoid excessive competition, enhance cooperation, and get used to the new vertical + horizontal relationship between significant company and SMEs to obtain synergy advantage