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Case study
Publication date: 20 January 2017

David Besanko, Sarah Gillis and Sisi Shen

The years 2011, 2012, and 2013 witnessed both significant developments and setbacks in global polio eradication efforts. On the positive side, January 13, 2012, marked a…

Abstract

The years 2011, 2012, and 2013 witnessed both significant developments and setbacks in global polio eradication efforts. On the positive side, January 13, 2012, marked a full year since India had detected a case of wild poliovirus. On the negative side, polio continued to be endemic in three countries-Pakistan, Afghanistan, and Nigeria-and in those countries the goal of eliminating polio seemed more challenging than ever. Between December 2012 and January 2013, sixteen polio workers were killed in Pakistan, and in February 2013, nine women vaccinating children against polio in Kano, Nigeria, were shot dead by gunmen suspected of belonging to a radical Islamist sect. In addition, after a 95 percent decline in polio cases in 2010, the number of cases in Nigeria rebounded in 2011. Recognizing that polio was unlikely to be eliminated in these countries in the near term, the Global Polio Eradication Initiative moved its target date for eradication from 2013 to 2018.

These setbacks sparked a debate about the appropriate strategy for global eradication of polio. Indeed, some experts believed that recent setbacks were not caused by poor management but were instead the result of epidemiological characteristics and preconditions that might render polio eradication unachievable. These experts argued that global health efforts should focus on the control or elimination of polio rather than on the eradication of the disease.

This case presents an overview of polio and the Global Polio Eradication Initiative and recounts the successful effort to eradicate smallpox. The case enables a rich discussion of the current global strategy to eradicate polio, as well as the issue of whether eradication is the appropriate global public health objective. More generally, the case provides a concrete example of a particular type of global public good, namely infectious disease eradication.

After analyzing and discussing the case, students will be able to:

  • Understand the nature of a global public good

  • Perform a back-of-the-envelope benefit-cost analysis of polio eradication

  • Discuss the appropriate strategy for eradicating an infectious disease

  • Apply game theory to analyzing which countries would be likely to contribute funds toward global polio eradication

  • Discuss the role of private organizations in the provision of global public goods

Understand the nature of a global public good

Perform a back-of-the-envelope benefit-cost analysis of polio eradication

Discuss the appropriate strategy for eradicating an infectious disease

Apply game theory to analyzing which countries would be likely to contribute funds toward global polio eradication

Discuss the role of private organizations in the provision of global public goods

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

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Case study
Publication date: 20 January 2017

David Besanko

In 1996, the St. Louis-based manufacturer Zoltek launched a massive expansion of capacity to produce commercial-grade carbon fiber, a composite material used to produce a…

Abstract

In 1996, the St. Louis-based manufacturer Zoltek launched a massive expansion of capacity to produce commercial-grade carbon fiber, a composite material used to produce a wide variety of end products ranging from sporting goods to windmill blades. Zoltek's goal was to become the dominant firm in a market whose growth was expected to be spectacular starting in the late 1990s. Describes Zoltek's major strategic moves in the mid-1990s and provides a possible example of the Stackelberg leadership model from oligopoly theory.

To explore the economic logic of a major capacity commitment.

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

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Case study
Publication date: 20 January 2017

Nabil Al-Najjar and David Besanko

Motorola invented mobile telephones and by the end of the 1980s came to dominate the mobile handset market with more than an 80% market share. A few years later, Motorola…

Abstract

Motorola invented mobile telephones and by the end of the 1980s came to dominate the mobile handset market with more than an 80% market share. A few years later, Motorola faced a key strategic choice of whether to focus its considerable resources on consolidating its dominance of the analog handset market or to shift these resources to emerging digital handset technologies. This decision shaped the handset industry and the role Motorola will play in it for the next decade.

To illustrate incumbents' puzzling inertia toward initiating and participating in disruptive technologies.

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

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Case study
Publication date: 20 January 2017

Nabil Al-Najjar, David Besanko and Roberto Uchoa

Describes market experiments conducted by a major credit card issuer. In a typical experiment, the issuer sends out hundreds of thousands of solicitations based on…

Abstract

Describes market experiments conducted by a major credit card issuer. In a typical experiment, the issuer sends out hundreds of thousands of solicitations based on information received from credit reporting agencies (e.g., credit score, past delinquencies, etc.). Selection bias is striking: the average risk profile of those responding to higher interest rates is significantly worse than that of respondents to lower rates. Tracking respondents for 27 months after the experiment, respondents to higher rates displayed significantly higher delinquency and bankruptcy rates. Based on a research paper by Larry Ausubel.

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

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Case study
Publication date: 20 January 2017

David Besanko and Takatoshi Imada

In early 2000, Asahi's senior management was under considerable pressure to launch its own brand of happoshu, a low-end form of beer that enjoyed certain tax benefits…

Abstract

In early 2000, Asahi's senior management was under considerable pressure to launch its own brand of happoshu, a low-end form of beer that enjoyed certain tax benefits under Japanese law. Unlike its major rivals, all of whom had launched happoshu brands in the previous few years, Asahi steadfastly refused to enter the happoshu category.

To explore the economic logic of Asahi's strategy. To study how the entry of a new product affects price competition across two closely related product categories (beer and happoshu) and how an anticipated change in price competition might affect the economics of the launch decision.

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

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Case study
Publication date: 20 January 2017

David Besanko

Provides a narrative description of the price war in the U.S. airline industry that broke out in Spring 1992.To use in competitive strategy or microeconomics classes to…

Abstract

Provides a narrative description of the price war in the U.S. airline industry that broke out in Spring 1992.

To use in competitive strategy or microeconomics classes to explore the root causes of price wars.

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

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Case study
Publication date: 20 January 2017

David Besanko, Johannes Horner and Ed Kalletta

Describes the events leading up to the imposition of the London congestion charge. Views about the congestion charge, both pro and con, are presented. Also discusses, in…

Abstract

Describes the events leading up to the imposition of the London congestion charge. Views about the congestion charge, both pro and con, are presented. Also discusses, in general terms, the economics of traffic congestion, pointing out that an unregulated market for driving will not reach the social optimum. Contains sufficient data to estimate the deadweight loss in an unregulated market and the reduction of the deadweight loss due to the imposition of the congestion charge in 2003.

To provide a good illustration of how an unregulated market with negative externalities can lead to an overprovision of a good (in this case driving). Also, to show how an externality tax (in this case, London's congestion charge) can lead to an improvement in social welfare.

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

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Case study
Publication date: 20 January 2017

David Besanko, Christopher Stori and Ed Kalletta

Considers the competitive strategy of the Channel Tunnel just prior to the time it opened for business in 1994. Focusing specifically on the tunnel's Le Shuttle service…

Abstract

Considers the competitive strategy of the Channel Tunnel just prior to the time it opened for business in 1994. Focusing specifically on the tunnel's Le Shuttle service for freight and passenger traffic, gives students an opportunity to explore whether Le Shuttle should follow a premium pricing strategy relative to the cross-channel ferries, match the ferries' prices, or undercut the ferries' prices. Following a section on the history of the tunnel's construction, provides an in-depth discussion of the cross-channel ferry business and the Le Shuttle services. Concludes by posing the question: What pricing strategy should Le Shuttle follow?

To illustrate the key drivers of price competition in a differentiated products industry: differences in marginal cost; vertical differentiation among competitors; the degree of horizontal differentiation in the market; and the sources and sustainability of competitive advantage.

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

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Case study
Publication date: 20 January 2017

David Besanko and João Tenreiro Gonçalves

Rede Alta Velocidade, SA (RAVE), the state-owned company responsible for planning and developing a major high-speed rail project in Portugal, must persuade both public…

Abstract

Rede Alta Velocidade, SA (RAVE), the state-owned company responsible for planning and developing a major high-speed rail project in Portugal, must persuade both public officials and lenders that the project is worth undertaking. It must also make a recommendation on the appropriate organizational form for the enterprise. Specifically, it must determine the role of the Portuguese government in financing and operating the high-speed rail network, with options ranging from full development and management of the project by the public sector to completely private development and management. Lying in between these two polar cases were a variety of hybrid models, often referred to as public-private partnerships (PPPs). Using data in the case, students have the opportunity to perform a benefit-cost analysis of the project. They also must think carefully about the optimal role of the government in a major new infrastructure project.

After analyzing and discussing the case, students will be able to:

  • Understand the nature of a global public good

  • Perform a back-of-the-envelope benefit-cost analysis of polio eradication

  • Discuss the appropriate strategy for eradicating an infectious disease

  • Apply game theory to analyzing which countries would be likely to contribute funds toward global polio eradication

  • Discuss the role of private organizations in the provision of global public goods

Understand the nature of a global public good

Perform a back-of-the-envelope benefit-cost analysis of polio eradication

Discuss the appropriate strategy for eradicating an infectious disease

Apply game theory to analyzing which countries would be likely to contribute funds toward global polio eradication

Discuss the role of private organizations in the provision of global public goods

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

To view the access options for this content please click here
Case study
Publication date: 20 January 2017

David Besanko and Saahil Malik

Although the federal gasoline tax played multiple roles in financing surface transportation infrastructure in the United States, experts did not agree on the tax's…

Abstract

Although the federal gasoline tax played multiple roles in financing surface transportation infrastructure in the United States, experts did not agree on the tax's purpose. Some argued that it was essentially a fee for users of the nation's federally supported highways. Others suggested that it should play a more prominent role in environmental, energy, and transportation policy by correcting for driving-related externalities. Still others suggested that it should be used to reduce the federal budget deficit. Finally, the tax itself had remained at the same level since 1993, and with the Highway Trust Fund virtually insolvent, many experts believed it was time for an increase. The case presents a background on the U.S. federal gasoline tax, an overview of the market for gasoline in the United States, and survey of gasoline taxes in U.S. states as well as several other countries around the world.

The case can be used to discuss the incidence of the gasoline tax, as well as its role as a Pigouvian tax to deal with negative externalities related to gasoline consumption and driving. There is sufficient data in the case to enable students to analyze the incidence of the federal gasoline tax and to determine the socially efficient level of the tax in light of externalities related to gasoline consumption and driving.

Details

Kellogg School of Management Cases, vol. no.
Type: Case Study
ISSN: 2474-6568
Published by: Kellogg School of Management

Keywords

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