Volume 31, 2022 Issue 2 Journal of Economics & Management Strategy

Volume 31, 2022 Issue 1 Journal of Economics & Management Strategy

Price effects of calling out market power: A study of the COVID-19 oil price shock

Aaron Barkley, David P. Byrne, and Xiaosong WuWe study gasoline retailers' price responses to antitrust announcements shaming them for price gouging during the COVID-19 pandemic. We identify price effects using a high-frequency event-study leveraging unique real-time station-level price data and well-identified, discrete antitrust announcements. We find evidence of announcement effects that depend on firms' preannouncement margins and hence exposure to being publicly shamed.

How much is privacy worth around the world and across platforms?

Jeffrey T. Prince and Scott WallstenUsing carefully designed discrete choice surveys, we measure individuals' valuation of online privacy across countries (United States, Mexico, Brazil, Colombia, Argentina, and Germany) and data types (personal information on finances, biometrics, location, networks, communications, and web browsing). We find that Germans value privacy more than do people in the United States and Latin American countries. Across countries, people most value privacy for financial (bank balance) and biometric (fingerprint) information.

Firm responsiveness to consumers’ reviews: The effect on online reputation

Erfan Rezvani and Christian RojasThis paper investigates whether firms' responsiveness to customer reviews affects firms' online reputation. The results show that one standard deviation increase in a hotel's responsiveness level would result in an improvement of 0.055 stars in TripAdvisor's average online rating (equivalently, an increase of 0.09 SD). We discuss the possible mechanism between firms' responsiveness and online reputation.

Price discrimination through cause-related marketing

Kameshwari Shankar and Suman GhoshA common form of Corporate Social Responsibility (CSR) by firms is to agree to donate a fixed portion of private good revenues to a charitable cause. In this paper, we explore a new rationale for such CSR known commonly as Cause-Related Marketing (CRM). We argue that linking private good purchase with charitable donations to a partnering nongovernmental organization (NGO) allows the firm to price discriminate between altruistic consumers who wish to make charitable donations out of their income and nonaltruistic consumers who do not place any value on such donations.

Environmental regulation and foreign investment: Evidence from China

Yunyi Hu, Haitao Yin, and Jon J. MoonThis paper estimates the impact of environmental regulation on foreign investment using the 2003 Pollution Discharge Fee Reform in China as a quasi-natural experiment. Using a Difference-in-Differences method to investigate foreign investment from 2000 to 2007, we propose the “Pollution Deterrence Hypothesis” and the “Green Strategy Hypothesis” and provide evidence for the debate between these two hypotheses. We find that foreign investors' strategic responses to enhanced environmental regulations depend on their initial shareholder status in a firm.

Submarine trademarks

Carsten Fink, Andrea Fosfuri, Christian Helmers, and Amanda F. MyersWe analyze the trade-off through the lens of “submarine trademarks” in the United States—submarine trademarks are trademarks whose publication and hence disclosure to the public are strategically delayed. We provide the first systematic evidence of submarine trademarks and explore their effectiveness in reducing the disclosure of information, their determinants, and their blocking effect on third-party trademark filings. We also provide evidence on the effect of trademark disclosure on third-party trademark filings.

Which two heads are better than one? Uncovering the positive effects of diversity in creative teams

Glenn Dutcher and Cortney S. RodetWe examine how diversity affects teams' output in the creative uses task. Diversity among team members' experience or knowledge leads to greater creative output; however, diversity over observable characteristics has no measurable impact. Surprisingly, we find no correlation between experiential diversity and diversity over observable characteristics in our sample. We propose that creative organizations can benefit by also emphasizing experiential diversity when constructing diversity policy to foster effective teams.

Dynamic monopoly and consumers profiling accuracy

Didier Laussel, Ngo Van Long, and Joana ResendeUsing a Markov-perfect equilibrium model, we show that the use of customer data to practice intertemporal price discrimination will improve monopoly profit if and only if information precision is higher than a certain threshold level. This U-shaped relationship lends support to a popular view that knowledge is good only if it is sufficiently refined.

Information accuracy and collusion

Stefano Colombo and Aldo PignataroIn this study, we investigate firms' ability to collude when price discrimination based on the inherited market is possible, but the information accuracy about the inherited market is imperfect. We show that the level of information accuracy affects collusion sustainability nonmonotonically, according to the starting level of information and the consumers' reservation price. Moreover, we show that banning price discrimination might increase the sustainability of tacit collusion.
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