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Article
Publication date: 3 April 2018

Jidong Han, Chun Qiu and Peter Popkowski Leszczyc

This paper aims to investigate how competition among online auction sellers influences the setting of both open and secret reserve prices, thereby affecting auction outcome.

Abstract

Purpose

This paper aims to investigate how competition among online auction sellers influences the setting of both open and secret reserve prices, thereby affecting auction outcome.

Design/methodology/approach

Using a data set collected from eBay consisting of 787 identical product auctions, three empirical models have been proposed. Model 1 simultaneously estimates the effects of auction competition on a seller’s own open and secret reserve price strategies; Model 2 estimates the effects of auction competition on bidder participation; and Model 3 estimates the direct and indirect effects of auction competition on selling price.

Findings

Competition among sellers is central to shaping sellers’ reserve price strategies. When there are more concurrent auctions for identical items, sellers tend to specify a low open reserve and are less likely to set a secret reserve. Sellers are strongly influenced by competitors’ reserve price strategies, and tend to follow competition. Finally, auction competition and competitive reserve price strategies influence both bidder entry and selling prices.

Practical implications

This study has important implications for both sellers and bidders. It highlights the importance for sellers to adapt their reserve price strategies in light of their competitors’ reserve price strategies and offers implications for bidders regarding auction selection. An auction with low starting bid does not necessarily lead to a lower selling price as it attracts more bidders.

Originality/value

This paper focuses on competition among auction sellers, whereas previous literature has focused on competition among bidders. This paper is the first to study the impact of competing reserve prices in auctions.

Details

European Journal of Marketing, vol. 52 no. 7/8
Type: Research Article
ISSN: 0309-0566

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Article
Publication date: 1 April 2006

Jean‐Laurent Viviani

Agricultural risks will tend to increase in the future, but risk management instruments and techniques at the disposal of wine companies are relatively limited. This paper…

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1449

Abstract

Purpose

Agricultural risks will tend to increase in the future, but risk management instruments and techniques at the disposal of wine companies are relatively limited. This paper aims to present an original risk protection mechanism implemented by the federation of Côte du Rhône (Inter‐Rhône) wine producers to build up a wine stock, or “reserve”, so as to protect their incomes against fluctuation in prices and production.

Design/methodology/approach

Using the VaR (value‐at‐risk) methodology, the stock level that will protect producers against a fall in their incomes is determined. More specifically, the probability that a given producer's current income falls lower than a target minimum income must be inferior or equal to a given (small) wine stock level. An agricultural income depends on price and production, so the reserve amount is expressed according to price and production quantity risk (measured by standard deviation), and the correlation between the two. The wine stock reserve is compared with a reserve invested in financial assets.

Findings

A static comparative analysis is made using simulations of the two types of reserves (wine stock and financial assets) according to the various explanatory variables. Empirical study makes it possible to calculate reserve amounts for each category of wine managed by Inter‐Rhône. The study reveals a strong disparity in the amount of reserves of each wine.

Originality/value

The reserve system is considered by some to give to the producer federation the power to control supply below the equilibrium level in order to receive monopoly rents. To avoid this occurring the constitution of a mutual fund is recommended. This solution allows producers to profit from diversification gains and greater managerial flexibility.

Details

British Food Journal, vol. 108 no. 4
Type: Research Article
ISSN: 0007-070X

Keywords

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Article
Publication date: 11 October 2018

Yanwen Tan and Huasheng Zeng

The purpose of this paper is to examine whether Chinese pork reserve regulation policy fulfills its function in stabilizing market prices and simultaneously to…

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1657

Abstract

Purpose

The purpose of this paper is to examine whether Chinese pork reserve regulation policy fulfills its function in stabilizing market prices and simultaneously to theoretically and empirically analyze the causes leading to the failure of Chinese Government’s intervention in the market, especially in the context of asymmetric pork and hog price information transmission.

Design/methodology/approach

A modified Reserve-Cobweb model based on the competitive storage model developed by Muth in 1961 is employed to examine the transmission effect of hog and pork prices under the setting of Chinese Government’s pork reserve regulation policy, using the data on Chinese hog and pork prices from June 2009 to June 2015.

Findings

While the Reserve-Cobweb model provides theoretical insights, suggesting that the implementation of the government’s reserve policy tool to control price volatility actually leads to increased price volatility, the empirical results indicate that the policy induces hypercorrection and impels greater price volatility, especially in the context of existence of asymmetric price information transmission.

Social implications

The Chinese Government should reduce excessive pork price intervention and instead allow the market to play its role in the hog and pork markets.

Originality/value

This paper develops a modified Reserve-Cobweb model based on the price transmission effect on different links within the agricultural products supply chain, which is used to empirically validate the existence of asymmetric price information transmission between pork and hog price in China.

Details

China Agricultural Economic Review, vol. 11 no. 2
Type: Research Article
ISSN: 1756-137X

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Abstract

Details

Energy Economics
Type: Book
ISBN: 978-1-83867-294-2

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Article
Publication date: 5 March 2018

Jameel Ahmed, Ahamed Kameel Mydin Meera, Muhammad Yusuf Saleem and Patrick Collins

This paper aims to apply the doctrine of siyasah shariyyah to a policy proposal in the area of monetary economics, namely, the Grondona system of conditional currency…

Abstract

Purpose

This paper aims to apply the doctrine of siyasah shariyyah to a policy proposal in the area of monetary economics, namely, the Grondona system of conditional currency convertibility, which has been proposed as a practical means of resisting the economic instability caused by the present-day fiat money system.

Design/methodology/approach

The paper uses library research to review the literature relevant to the Grondona system, and examines the extent to which its operations conform to the principle of siyasah shariyyah, thereby encouraging Maslahah, i.e. the public interest.

Findings

It has been found that the Grondona system conforms to the philosophy of siyasah shariyyah because it promotes public welfare in a number of ways. First, it is based on the fundamental principle of Prophet Yusuf’s/Joseph (peace be upon him) economic planning, which is accumulating reserves of primary commodities during times of plenty and releasing those reserves of commodities during periods of scarcity. Second, it provides the necessary linkage between the monetary world and the real economy. Third, it could be implemented in parallel with the existing monetary system by using the national currency. Fourth, it would help the least developed countries of the world, which mainly depend on exports of primary commodities (mostly agricultural).

Research limitations/implications

Because of the chosen research approach, this research study is theoretical in nature. Therefore, researchers are encouraged to evaluate the system from economic perspective based on simulation for the purpose of possible implementation.

Practical implications

The paper includes important implications for the policymakers in the Organization of Islamic Cooperation countries for the possible implementation of Grondona system.

Originality/value

This paper fulfils an identified need to apply the philosophy of siyasah shariyyah to the area of monetary economics.

Details

Journal of Islamic Accounting and Business Research, vol. 9 no. 2
Type: Research Article
ISSN: 1759-0817

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Article
Publication date: 28 December 2020

Lydia Cheung and Mario Andres Fernandez

This study aims to test whether the size of and distance to the nearest green space has any effects on residential property transaction prices in Auckland, New Zealand.

Abstract

Purpose

This study aims to test whether the size of and distance to the nearest green space has any effects on residential property transaction prices in Auckland, New Zealand.

Design/methodology/approach

This paper divides all green spaces in Auckland into three categories, namely, urban parks, regional reserves and volcanic parks (a unique feature in Auckland, New Zealand). This study uses six years of residential property transaction data to estimate hedonic price regressions. For each property, this paper calculates the size of and distance to the nearest park in each category.

Findings

The logged sizes of the nearest regional reserve and volcanic park have positive effects on property prices. The logged distances to the nearest urban park and volcanic park are insignificant, while the logged distance to the nearest regional reserve is positively significant. In other words, homebuyers prefer larger regional reserves and volcanic parks and prefer to be further away.

Originality/value

Auckland is ranked as a top-five city in the world in terms of the proportion of public green space, trailing four European cities. However, because of Auckland’s much younger age, it presents a very different urban form. The study shows that the distribution of green space (not only its total amount) can bring negative capitalization on property prices.

Details

International Journal of Housing Markets and Analysis, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1753-8270

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Article
Publication date: 6 January 2021

Yuewu Tang, Yang Song, Chang Xu and Tijun Fan

Using information systems via data mining and cluster analysis technologies, consumers' strategic behaviour can be measured, and their patience levels can be accurately…

Abstract

Purpose

Using information systems via data mining and cluster analysis technologies, consumers' strategic behaviour can be measured, and their patience levels can be accurately described. This paper investigates the retailer's pricing and ordering policies when facing strategic consumers with different levels of patience and discusses the impacts of consumers' patience levels and proportions on retailers' maximum expected profits.

Design/methodology/approach

By cluster analysing transaction data on the number of websites visited, browsing time and purchase decision time, consumers' patience levels can be obtained. The authors formulate a newsvendor model considering customers' different patience levels. Three scenarios are investigated: two segments of consumers with two different levels of patience (Scenario I), multiple segments of consumers with different levels of patience (Scenario II) and a continuum of consumers whose levels of patience follow a continuous distribution (Scenario III). Then, general formulas are deduced for retailers' optimal prices, ordering quantities and profits.

Findings

Under Scenario I, if the proportion of less patient consumers is greater (less) than a threshold, the retailer's optimal price is equal to the less (more) patient consumers' reserve price. Under Scenario II, once the proportion of fully strategic consumers exceeds a certain threshold, the retailers' optimal price is equal to the fully strategic consumers' reserve price regardless of consumers' patience levels and proportions. Under Scenario III, the retailer's pricing and ordering policies depend on the distribution of their patience level.

Originality/value

Few studies have considered consumers' different levels of patience when making retailer pricing and ordering decisions. In this paper, strategic consumer behaviour is measured, and consumers' patience levels and proportions are obtained by cluster analysing consumer transaction data recorded by an information system. Three scenarios in which strategic consumers may be heterogeneous and have different patience levels are investigated. The results can guide retailer decision-making.

Details

Industrial Management & Data Systems, vol. 121 no. 2
Type: Research Article
ISSN: 0263-5577

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Article
Publication date: 11 July 2016

Ting Zhang, Ting Qu, George Q. Huang, Xin Chen and Zongzhong Wang

Commonly shared logistics services help manufacturing companies to cut down redundant logistics investments while enhance the overall service quality. Such service-sharing…

Abstract

Purpose

Commonly shared logistics services help manufacturing companies to cut down redundant logistics investments while enhance the overall service quality. Such service-sharing mode has been naturally adopted by group companies to form the so-called headquarter-managed centralized distribution center (HQ-CDC). The HQ-CDC manages the common inventories for the group’s subsidiaries and provides shared storage services to the subsidiaries through appropriate sizing, pricing and common replenishment. Apart from seeking a global optimal solution for the whole group, the purpose of this paper is to investigate balanced solutions between the HQ-CDC and the subsidiaries.

Design/methodology/approach

Two decision models are formulated. Integrated model where the group company makes all-in-one decision to determine the space allocation, price setting and the material replenishment on behalf of HQ-CDC and subsidiaries. Bilevel programming model where HQ-CDC and subsidiaries make decisions sequentially to draw a balance between their local objectives. From the perspective of result analysis, the integrated model will develop a managerial benchmark which minimizes the group company’s total cost, while the bilevel programming model could be used to measure the interactive effects between local objectives as well as their final effect on the total objective.

Findings

Through comparing the numerical results of the two models, two major findings are obtained. First, the HQ-CDC’s profit is noticeably improved in the bilevel programming model as compared to the integrated model. However, the improvement of HQ-CDC’s profit triggers the cost increasing of subsidiaries. Second, the analyses of different sizing and pricing policies reveal that the implementation of the leased space leads to a more flexible space utilization in the HQ-CDC and the reduced group company’s total cost especially in face of large demand and high demand fluctuation.

Research limitations/implications

Several classical game-based decision models are to be introduced to examine the more complex relationships between the HQ-CDC and the subsidiaries, such as Nash Game model or Stackelberg Game model, and more complete and meaningful managerial implications may be found through result comparison with the integrated model. The analytical solutions may be developed to achieve more accurate results, but the mathematical models may have to be with easier structure or tighter assumptions.

Practical implications

The group company should take a comprehensive consideration on both cost and profit before choosing the decision framework and the coordination strategy. HQ-CDC prefers a more flexible space usage strategy to avoid idle space and to increase the space utilization. The subsidiaries with high demand uncertainties should burden a part of cost to induce the subsidiaries with steady demands to coordinate. Tanshipments should be encouraged in HQ-CDC to reduce the aggregate inventory level as well as to maintain the customer service level.

Social implications

The proposed decision frameworks and warehousing policies provide guidance for the managers in group companies to choose the proper policy and for the subsidiaries to better coordinate.

Originality/value

This research studies the services sharing on the warehouse sizing, pricing and common replenishment in a HQ-CDC. The interactive decisions between the HQ-CDC and the subsidiaries are formulated in a bilevel programming model and then analyzed under various practical scenarios.

Details

Industrial Management & Data Systems, vol. 116 no. 6
Type: Research Article
ISSN: 0263-5577

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Abstract

Details

Energy Economics
Type: Book
ISBN: 978-1-83867-294-2

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Article
Publication date: 1 September 2000

Victor J. Massad and Joanne M. Tucker

Examines the phenomenon of online auctions. Begins by developing a theoretical base for understanding how online and in‐person auctions should differ in terms of consumer…

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2542

Abstract

Examines the phenomenon of online auctions. Begins by developing a theoretical base for understanding how online and in‐person auctions should differ in terms of consumer risk. Online auctions with seller reserve prices are compared to in‐person auctions without seller reserve prices using data from 60 paired sales of collectible figurines. Online auctions are found to exceed in‐person auctions in both mean initial bid prices and mean final sales prices.

Details

Journal of Product & Brand Management, vol. 9 no. 5
Type: Research Article
ISSN: 1061-0421

Keywords

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