Regular Price Research Articles

A DISCIPLINA E SUAS NORMAS: A HIGIENIZAÇÃO DA CARNE E DOS ESTABELECIMENTOS E A ATUAÇÃO DOS Aá‡OUGUEIROS E MARCHANTES EM BELÉM NA VIRADA DO XX.

Este artigo estuda as normas de higienização e a atuação dos comerciantes de carne verde nacidade de Belém entre os anos de 1899 a 1908. Por meio da atuação da Intendência e as práticas deembelezamento da cidade, buscou-se compreender os discursos de higienização propagados nosdocumentos e as alternativas de controle do mercado das carnes através da atuação dos marchantesque transgrediam os códigos de postura vigentes na época. Nesse momento percebeu-se que aimprensa paraense atuava como porta-voz dos direitos da população, principalmente em defesa dofornecimento regular, da qualidade e dos preços baixos da carne, por meio da publicação dos dramasda vida cotidiana dessa população, geralmente nas primeiras páginas ou nas colunas de destaque,dando visibilidade ao problema do abastecimento de carne, conforme seus interesses.

Effect of font size and appearance in left-digit price cognition

Research has indicated that changes in price endings can result in left digit effects (for example, $3.99 versus $4.00). In this study, we report on the effects of price font size and appeared model on a nine-ending price where the leftmost digit is changed. Cognition of comparative price can be magnified or weakened depending on such factors. First, when the same font size is used for the price or the size-value congruency conditions are the same, the magnitude of price difference between the target and standard prices will be perceived as larger when the leftmost digit of a 9-ending price is changed (for example, $299 versus $300). Enlarging the price font size causes the perceived magnitude of the size-value incongruence of the left-digit effect in nine-ending prices to diminish. Second, when the price appears vertically it will facilitate the comparison of two prices and diminish the perceived magnitude of difference in price in comparison between the regular price and the sale price. Key words: Left-digit effect, 9-ending price, font size, vertical appeared model.

The realm of cellulases in biorefinery development

Geopolitical concerns (unstable supply of gasoline, environmental pollution, and regular price hikes), economic, and employment concerns have been prompting researchers, entrepreneurs, and policy makers to focus on harnessing the potential of lignocellulosic feedstock for fuel ethanol production and its commercialization. The carbohydrate skeleton of plant cell walls needs to be depolymerised into simpler sugars for their application in fermentation reactions as a chief carbon source of suitable ethnologic strains for ethanol production. The role of cellulolytic enzymes in the degradation of structural carbodydrates of the plant cell wall into ready-to-fermentable sugar stream is inevitable. Cellulase synergistically acts upon plant cell wall polysaccharides to release glucose into the liquid media. Cellulase predominantly dominates all the plant cell wall degrading enzymes due to their vast and diverse range of applications. Apart from the major applications of cellulases such as in detergent formulations, textile desizing, and development of monogastric feed for ruminants, their role in biorefinery is truly remarkable. This is a major area where new research tools based upon fermentation based formulations, biochemistry, and system biology to expedite the structure–function relationships of cellulases including cellulosomes and new designer enzymatic cocktails are required. In the last two decades, a considerable amount of research work has been performed on cellulases and their application in biomass saccharification. However, there are still technical and economic impediments to the development of an inexpensive commercial cellulase production process. Advancements in biotechnology such as screening of microorganisms, manipulation of novel cellulase encoding traits, site-specific mutagenesis, and modifications to the fermentation process could enhance the production of cellulases. Commercially, cheaper sources of carbohydrates and modified fermentation conditions could lead to more cost-effective production of cellulases with the goal to reduce the cost of ethanol production from lignocellulosics. Implementation of integrated steps like cellulase production and cellulase mediated saccharification of biomass in conjunction with the fermentation of released sugars in ethanol in a single step so called consolidated bio-processing (CBP) is very important to reduce the cost of bioethanol. This paper aims to explore and review the important findings in cellulase biotechnology and the forward path for new cutting edge opportunities in the success of biorefineries.

Enhancing perceptions of price–value associated with price-matching guarantees

The authors examine how retailers can frame price-matching guarantees (PMGs) to address customers' goal orientations (promotion or prevention focused) and enhance their perceptions of price–value. To enhance price–value perceptions, the authors manipulate participants' temporary goal orientations (study 1) and the framing of PMG offers (study 2). The results demonstrate that retailers can temporarily elevate consumers' prevention orientations to enhance their preferences for PMGs over regular price offers. Retailers who have promotion-oriented customer bases can frame PMGs so that their customers will perceive the offers as being promotion oriented. Implications for retailing practice and future research directions are discussed.

Loyalty Rewards Facilitate Tacit Collusion

Using a dynamic overlapping‐generations model, we show that loyalty rewards robustly facilitate tacit collusion. We compare the sustainability of tacit collusion when uniform prices are used, when loyal customers are rewarded without using commitment, and when loyalty rewards are implemented by committing to offering customers either lower fixed repeat‐purchase prices or fixed repeat‐purchase discounts. We find that, relative to uniform prices, rewarding loyalty without using commitment on the equilibrium path makes tacit collusion easier to sustain, because a deviating firm is unable to steal one period of industry profit before losing all future profits. When loyalty rewards are offered by firms committing to repeat‐purchase prices, collusion is even easier to sustain, because a deviating firm cannot renege on its discounted price for repeat‐purchase customers. When firms commit to repeat‐purchase discounts, they also commit to lowering the price for their repeat‐purchase customers if they undercut the regular price, rendering tacit collusion to be even more readily sustainable. Our results hold whether products are homogeneous or horizontally differentiated as in a Hotelling model.

Impact of promotions on shopper price comparisons

Retailers implementing the Hi–Lo or promotional-pricing strategy frequently offer temporary price promotions to attract customers to the store. For this strategy to be financially successful, however, the store must entice bargain seekers to purchase non-discounted merchandise. Because regular prices at Hi–Lo retailers, as a rule, substantially exceed those of EDLP competitors, customers engaging in price comparisons across stores may perceive that a Hi–Lo retailer's regular (non-discounted) prices are excessive relative to competitors' prices and therefore will be less likely to make purchases at the regular Hi price. Given the potentially harmful effects of across-store price comparisons for Hi–Lo retailers, this exploratory research examines whether some forms of price promotion may be relatively more effective at discouraging consumers from comparing a retailer's non-discounted prices to those at competing stores.

How Consumers Respond to the Behavior of Missing a Free Gift Promotion: Inaction Inertia Effect on Products Offered as Free Gifts

ABSTRACT Inaction inertia describes the phenomenon that an individual is unlikely to act on an attractive opportunity after having bypassed an even more attractive one. The results of two experiments indicate that after missing an initial opportunity to obtain a product as a free gift during a promotional period, the inaction inertia effect reduces the likelihood of consumers buying the product at a discounted price (second, inferior opportunity), particularly if the free gift has a high regular price. Additionally, according to the results of Experiment 2, those consumers are less likely to buy a product that has been offered previously as a free gift when a greater total quantity of the free gift is offered during a promotional period. Moreover, the mediation analysis results indicate that anticipated regret and valuation significantly impact the mediating role of inaction inertia.

Price setting in forward-looking customer markets

If consumers form habits in individual goods, firms face a time-inconsistency problem. Low prices in the future help attract customers in the present. Firms, therefore, have an incentive to promise low prices in the future, but price gouge when the future arrives. In this setting, firms benefit from “committing to a sticky price.” If consumers have incomplete information about costs and demand, the firm-preferred equilibrium has the firm price at or below a “price cap.” The model therefore provides an explanation for the simultaneous existence of a rigid regular price and frequent “sales”.

Menu Costs, Multiproduct Firms, and Aggregate Fluctuations

Golosov and Lucas recently argued that a menu-cost model, when made consistent with salient features of the microdata, predicts approximate monetary neutrality. I argue here that their model misses, in fact, two important features of the data. First, the distribution of the size of price changes in the data is very dispersed. Second, in the data many price changes are temporary. I study an extension of the simple menu-cost model to a multiproduct setting in which firms face economies of scope in adjusting posted and regular prices. The model, because of its ability to replicate this additional set of microeconomic facts, predicts real effects of monetary policy shocks that are much greater than those in Golosov and Lucas and nearly as large as those in the Calvo model. Although episodes of sales account for roughly 40% of all goods sold in retail stores, the model predicts that these episodes do not contribute much to the flexibility of the aggregate price level.

The Impact of Transaction Utility on Consumer Decisions

In consumption decisions, Thaler (1985) distinguishes acquisition and transaction utility. Whereas acquisition utility stands for the pleasure from obtaining a good, transaction utility denominates the value consumers derive from the deal itself. Transaction utility depends on a comparison of actual prices with reference to other prices such as the regular price. The present article reports two experimental studies demonstrating the effect of transaction utility on purchase decisions. In Experiment 1 (N = 90), on the basis of prospect theory (Kahneman & Tversky, 1979), it is expected that negative transaction utility affects purchase decisions to a higher degree than its positive counterpart. Results support this hypothesis. In Experiment 2 (N = 121) it is hypothesized that acquisition utility moderates the effect of transaction utility, that is, transaction utility becomes less important if a product is desired primarily for its actual value. Though both forms of utility affected purchase intentions, no support for the moderation hypothesis was observed.

The study on advertisement of dental devices & instrument during Japanese colonized period

This article is purposed of reviewing the development history of Japanese dental devices and instrument, and their related advertisement activities during the Japanese colonized period in Korea in early 20th century. Japanese dental devices and instrument were redesigned to accommodate their ergonomic shape above the simple imitation, and it implies the excessive desires brought them frustrations. The tragic earthquake on Sep. l, 1923, medical insurance law enforcement on Jan. 1, 1927, celebration of "Cavity prevention Day" started on Jun. 4, 1928, and the attack of Manchuria and China by Japan after 1931, all of these historical incidents become the preliminary requirement for the development of dental devices. On Nov. 1, 1937, Japanese government started to control dental materials, driving the campaigns for excluding foreign products and encourging the use of local products. In 1939, Nakajima dental manufacturers used this political and social atmosphere on their advertisement as saying "Our Nakajima's products have no compromise with the short raw materials, but only commitment to our quality". Since after 1940, the price and supply have been strongly under control, and the control group was appeared to manage all of supply and distribution of raw materials, regular price system, and specifications. At last, the Japanese national power were devastated in its production and distribution capacities, and get to the frustrated period. The main advertised dental devices and instruments in Korea during the Japanese colonized period were 1) dental chair, unit and cabinet, 2) dental x-ray, 3) compressors, 4) dental needles, 5) small instrument and carryon medical(emergency) kit, 6) oral hygiene and pyorrhea alveolaris, infrared rays, sunlight lamp, ultrashort wave treatment devices, 7)crown former, electric furnace, casting machine, articulator, electric lathe, and laboratory equipments, etc.

Regular Prices and Sales

We study the properties of a profit-maximizing monopolist's optimal price distribution when selling to a loss-averse consumer, where (following Kőszegi and Rabin (2006)) we assume that the consumer's reference point is her recent rational expectations about the purchase. If it is close to costless for the consumer to observe the realized price of the product, then – in a pattern consistent with several recently documented facts regarding supermarket pricing – the monopolist chooses low and variable “sale” prices with some probability and a high and sticky “regular” price with the complementary probability. Realizing that she will buy at the sale prices and hence that she will purchase with positive probability, the consumer chooses to avoid the painful uncertainty in whether she will get the product by buying also at the regular price. If it is more costly for the consumer to observe the realized price, then – in a pattern consistent with the pricing behavior of some other retailers (e.g. movie theaters) – the monopolist chooses a sticky price and holds no sales. In this case, a sale is less tempting and hence less effective in generating an expectation to purchase with positive probability. We also show that ex-ante competition for loyal consumers leads to sticky pricing while ex-post competition leads to marginal-cost pricing, and discuss several other extensions of the model.

Sales and price spikes in retail scanner data

Price filters used by macroeconomists place strong restrictions on “regular price” series. I propose a new price filter and show that, while many pricing facts are robust to filter specification, implications for price duration depend on the choice of filter.

Attractive Prices and Euro-Rounding Effects on Inflation

Approximately 70% of Belgian consumer prices are to be considered as attractive prices, namely psychological prices, fractional prices - i. e. prices which are convenient to pay - and round prices. Conversion of these prices into euro generally leads to prices which are no longer attractive and it is very likely that retailers will round their prices to attractive euro prices. The public fears that rounding will be upward rather than symmetric. This paper simulates in the first instance a worst-case scenario, whereby all attractive BEF prices are systematically rounded up to the nearest attractive euro price. The effect on the consumer price index ranges from 0.54 to 0.72%. Such a scenario is however very unlikely, as factors such as competition on product markets, the currently prevailing demand conditions, the commitments made by organisations representing the enterprise sector and the vigilant attitude of consumers restrain the possibility of rounding up. In order to obtain a more realistic picture, the paper investigates in a second step whether rounding-up effects were found after the major change in VAT rates in April 1992. These effects seem marginal, although it should be acknowledged that it was difficult to isolate rounding effects from regular price changes. Any ex post assessment of the euro changeover will face a similar identification problem.

Downside risk asset pricing revisited: a new non-linear threshold model

We derive an asset pricing equilibrium formula in which the risk premium on a risky asset is given by a weighted sum of the regular beta capital asset pricing model and a market portfolio downside risk beta. The equilibrium model is obtained from a new utility function that builds on the class of downside risk functions introduced in Bawa (1975, 1978) and that can be interpreted as an alternative to the disappointment utility functions of Dekel (1986) and Gul (1991), and the loss aversion utility functions as in Tversky and Kahneman (1991, 1992). This equilibrium model is econometrically represented by a non-linear threshold model that depends on a target return indicating market downturns. In the case where the target return is unknown we introduce an estimator of this threshold and a hypothesis test to assess statistically the significance of the downside risk parameter in the risk premium of the risky asset. An empirical exercise to industry, size and book-to-market portfolios uncovers a strong relationship between the risk premium and market portfolio downside risk

Inventory control by different service levels

This paper examines the multiple period inventory control problem of a single product with multiple (two) prices, depending on service level, in which optimal pricing and ordering decisions are made in each period. Traditional inventory and pricing models consider only single products, single prices, and single service levels. However, this research paper finds that a seller can improve inventory control and revenue by offering multiple prices depending on service level. This research considers a single product with multiple (two) pricing policies corresponding to service level as follows: if the customer is willing to delay the shipment, he/she will be offered a lower regular price. Otherwise, the customer will pay the regular price plus extra charges for express service. In this paper, I show the following: (1) there is an optimal pricing and replenishment policy that can control inventory and (2) there exists a finite threshold for inventory levels such that if the inventory level at the beginning of each period is higher than the threshold, the customer will be offered the express service at the regular price, without any extra charge.

Regular Infinite Economies

The main contribution of this paper is to place smooth infinite economies in the setting of the equilibrium manifold and the natural projection map à la Balasko. We show that smooth infinite economies have an equilibrium set that has the structure of a Banach manifold and that the natural projection map is smooth. We define regular and critical economies, and regular and critical prices, and we show that the set of regular economies coincides with the set of economies whose excess demand function has only regular prices. Generic determinacy of equilibria follows as a by-product.

Advance-purchase discounts as a price discrimination device

In an intertemporal setting in which individual uncertainty is resolved over time, advance-purchase discounts can serve to price discriminate between consumers with different expected valuations for the product. Consumers with a high expected valuation purchase the product before learning their actual valuation at the offered advance-purchase discount; consumers with a low expected valuation will wait and purchase the good at the regular price only in the event where their realized valuation is high. We characterize the profitmaximizing pricing strategy of the monopolist. Furthermore, adopting a mechanism design perspective, we provide a necessary and sufficient condition under which advance-purchase discounts implement the monopolist’s optimal mechanism.

Consumer responses to the depth and minimum claimed savings of “Scratch and Save (SAS)” promotions

AbstractThis study examines consumers' responses to advertisements employing “Scratch and Save” (SAS) type promotions, which are emerging store‐level promotional tools. Due to SAS promotions' “gambling” characteristics, they offer the possibility of high savings levels, however, they also confront the consumer with uncertainty about the value of the discount at the point of purchase. Particular attention is paid to the depth of the claimed savings, and its effect on regular price believability and consumers' expected savings, as well as perceived value and shopping intentions. The depth of the advertised SAS promotions was observed to not affect consumer believability of the regular price in SAS advertisements. In addition, the disjunction effect is made applicable through showing that the minimum claimed saving information enhances the level of savings expectation. The results also report the positive impact of expected savings on offer value and, in turn, shopping intentions. © 2010 Wiley Periodicals, Inc.

Loyalty Rewards Facilitate Tacit Collusion

Using a dynamic overlapping-generations model, we show that loyalty rewards robustly facilitate tacit collusion. We compare the sustainability of tacit collusion when uniform prices are used, when loyal customers are rewarded without using commitment, and when loyalty rewards are implemented by committing to offering customers either lower fixed repeat-purchase prices or fixed repeat-purchase discounts. We find that, relative to uniform prices, rewarding loyalty without using commitment on the equilibrium path makes tacit collusion easier to sustain, because a deviating firm is unable to steal one period of industry profit before losing all future profits. When loyalty rewards are offered by firms committing to repeat-purchase prices, collusion is even easier to sustain, since a deviating firm cannot renege on its discounted price for repeat-purchase customers. When firms commit to repeat-purchase discounts, they also commit to lowering the price for their repeat-purchase customers if they undercut the regular price, rendering tacit collusion to be even more readily sustainable. Our results hold whether products are homogeneous or horizontally differentiated as in a Hotelling model.