Author: Marco KotschedoffPublisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
Essays in Empirical Industrial Organization: Applications of Structural Models in the Retailing Industry
Author: Marco KotschedoffThree Essays on Empirical Industrial Organization
Author: Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
In the first essay I offer a structural model of firm behavior that builds up on a neoclassical demand system, namely the Generalized Quadratic Almost Ideal Demand System, and an assumption of firms pursuing profit maximization. I contribute to the literature by relaxing several important restrictions on the consumer behavior that have been used widely in the past. With the important aspects of firm market conduct unobservable, the structural models of firm behavior heavily rely upon the assumption that consumer demand is correctly specified. Therefore, we show that oligopoly market studies overlooking these aspects of demand will likely result in wrong inferences and lead to misleading policy implications. In the second essay, I extend the standard random coefficient logit demand(S-RCL) that has been a workhorse model in the most recent Empirical IO literature. While the S-RCL relies on an ad-hoc linear functional form for the indirect utility function implying constant marginal utility of product attributes, I generalize this framework allowing for diminishing marginal utility and let the data determine the utility functional form. I then apply this framework to study vertical interactions between milk manufacturers and retailers in the U.S., and show that retailers have more market power under this generalized structure vis-à-vis the model using S-RCL demand. In the third essay I offer a new conceptual framework for studying the market performance of vertically aligned retail-manufacturing sectors. It revisits the benefit function approach to modeling demand, and extends its application to the empirical IO literature. I demonstrate the usefulness of the approach in a study of retail market behavior in the marketing of branded and private label yogurt.
Essays on Empirical Industrial Organization
Author: Tianli XIA (Ph.D.)Publisher:
ISBN:
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Languages : en
Pages : 0
Book Description
My thesis applies recent empirical industrial organization tools to study policy and managerial questions arising in three important market settings: healthcare, digital platforms, and urban housing/transportation. The first chapter of the paper studies a vertical contract, ''resale price maintenance'' (RPM). RPM is controversial from an antitrust perspective because it can eliminate double markups but facilitate price coordination across retailers. I offer direct empirical evidence on these effects of RPM by combining an anti-trust case about RPM with a novel retailer-level dataset. I find that RPM is primarily used to reduce double markups while also facilitating price coordination in the retail sector. Motivated by these findings, I build and estimate a structural model and illustrate how the key model primitives (consumer substitution patterns and manufacturer bargaining power) determine the welfare to offer insights for regulators. The second chapter studies a prevalent dilemma on digital platforms: whether a platform should capitalize on popular content to satisfy viewers in the short run or support nascent content creators for better performance in the long run. I examine an internal experiment in a short-form video platform to quantify the effects of a support program on novice content creators. I find that the program leads to a worse viewer experience in the short run but leads to more content posting and higher content quality. The combined results suggest that improving content quality could counterbalance the adverse effects on viewer experience within three months. The last chapter builds an equilibrium sorting model of housing location and commuting mode choice with endogenous traffic congestion to evaluate the efficiency and equity impacts of a menu of urban transportation policies. Leveraging fine-scale data from household travel diaries and housing transaction data identifying residents' home and work locations in Beijing, we recover structural estimates with rich preference heterogeneity over both travel mode and residential location decisions. Overall, our results advocate for a congestion pricing policy coupled with subway construction.
Three Essays in Industrial Organization
Author: Limin FangPublisher:
ISBN:
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Languages : en
Pages :
Book Description
My thesis includes three chapters that examine the dynamics of competition in the retail industry. Chapter One of the thesis demonstrates that online review platforms help consumers learn faster about product quality and improve consumer welfare as a result. To examine this, I use a novel dataset containing the universe of full-service restaurants in Texas, consumer search interest on major online review platforms and their online review information. I illustrate that online review platforms' effects on learning show up in restaurant revenues and survival probabilities. Specifically, doubling consumers' exposure to Yelp, the dominant platform, increases the revenue of a high-quality new independent restaurant by 8-20% and decreases that of a low-quality restaurant by about the same amount. Doubling Yelp exposure also raises the survival rate of a new high-quality independent restaurant by 7-19 basis points and reduces that of a low-quality restaurant by a similar level. Other platforms, especially Google, have similar effects but in smaller magnitude. In contrast, online platforms do not affect the revenues or survival rates of chains and old independent restaurants. Counterfactual analysis based on a structural demand model with consumer learning shows that online review platforms speed up the learning process by 0.5 to 2.5 years, increase consumer welfare by 5.4% and the total industry revenue by 5.9% during the period of 2005-2015. Chapters Two and Three deal with the entry and exit dynamics of the retail industry, in particular, how chain retailers can pre-empt the entry of competitors by densely packing a geographic area with their outlets. Chapter Two develops a measure for preemptive motives in dynamic oligopoly games with entry and exit, and applies the measure in both theoretical and empirical studies. Chapter Three uses this measure in the fast casual dining industry in Texas to investigate if there is a trade-off between preemptive entry and survival of firms. The results show that under some conditions, preemption in fact helps the incumbent firm survive, while in other cases, preemption harms survival.
Three Essays in Empirical Industrial Organization
Author: Abraham C. DunnPublisher:
ISBN:
Category :
Languages : en
Pages : 278
Book Description
There are many differentiated product industries in which firms offer multiple products in the same market. In making strategic decisions regarding entry, quality and quantity to be supplied for their multiple products firms must consider the competition with rivals as well as cannibalization of their own products that are close substitutes. In this setting, understanding the relationship between the behavior of consumer demand and firms decisions' regarding product characteristics and strategic variables like advertising are fundamental issues in industrial organization. This dissertation empirically explores these fundamental issues in the pharmaceutical and airline industries. The first paper of my dissertation estimates consumer demand for different anti-cholesterol drugs using panel data on a nationally representative sample of individuals who were diagnosed with cholesterol problems in the period 1996-2002. The data provides detailed information on individuals' medical conditions, medical and drug insurance coverage, drug purchases (if any), and other demographic and medical information. Individuals choose whether to purchase an anti-cholesterol rug and, if so, which drug to buy. The model permits flexible substitution patterns among drug choices and persistence in those choices by incorporating both observed and unobserved consumer heterogeneity. The estimates suggest that lower income patients without prescription drug insurance are very price sensitive: they are less likely to use drugs and, if they do use them, they tend to purchase the less expensive drugs. I find that roughly 500 thousand individuals without drug insurance who are currently not purchasing anti-cholesterol drugs would do so in the counterfactual world in which they are given the standard co-payment plan. The second paper also looks at consumer demands for anti-cholesterol drugs. While the first paper focused on the differentiated products, this paper explores the market expansion effects of direct-to-consumer advertising (DTCA). The study combines the individual data used in the first paper with monthly expenditure data on DTCA for the period 1996-2002. The dynamic demand model estimated in this paper explores the heterogeneous effects of DTCA. Overall, I find a positive effect from DTCA with short term elasticity of 0.107. Through persistence in consumer demand this effect lasts over multiple time periods. I find that individuals not taking a cholesterol drug respond more to advertising than those on the drug. In addition, I find that less educated individuals, those that may be unaware of their health condition, and those without health insurance are most responsive to DTCA. Finally, the third paper studies the effect of product ownership and quality on entry in the airline industry. Specifically, this paper empirically examines the decision of an airline to offer high quality nonstop service between cities given that the airline may or may not be offering lower quality one-stop service. I find that airlines that offer one-stop service through a hub are less likely to enter that same market with nonstop service than those that do not. In addition, the quality of the one-stop service is another determinant of entry. Airlines are more likely to enter a market with nonstop service if their own or their rival's one-stop service in the market are of lower quality.
Essays on Empirical Industrial Organization
Author: Julia GonzalezFour Essays in Empirical Industrial Organization
Author: Andrea-Louise MüllerEssays in Empirical Industrial Organization
Author: Alessandra AlloccaEssays In Empirical Industrial Organization
Author: Lorenzo CattivelliPublisher:
ISBN:
Category :
Languages : en
Pages : 129
Book Description
I study the determinants of the firms' investment decisions. First, I quantify how building transport infrastructure affects investments. Whereas there is growing evidence that new infrastructure reduces trade costs, we lack a rigorous empirical understanding on how it impacts investments. To make progress, I leverage the U.S. crude oil industry. I specify a structural model of discrete investments centered around the producers' dynamic trade-off between current revenues and delaying investments to wait for additional transport infrastructure. I bring this model to a comprehensive dataset that allows me to match the drilling activity of oil producers with the construction of pipelines across space and over time. I estimate that pipelines reduce the producers' transportation costs by 15%, increasing the amount of new oil wells by 28%. In sum, I find that firms substantially increase investments in response to the new transport infrastructure. Then, I study how the firms' ownership structure affects investments. Vertical integration could increase investments for the integrating firm and reduce investments for its rivals. I measure the investment outcomes of eight vertical mergers in the US motion picture industry using 1997-2019 movie-level and companies' ownership data. Using a difference-in-difference research design, I estimate that vertical mergers increase investments for the integrating counterpart by 73.5%, while reducing investments for its rivals by 47%. Then I specify a within-firm model of resource allocation in order to separate the role of credit constraints and industry-specific technology from the change in the internalized return from investments. The results support the property rights theory.
Essays on Industrial Organization
Author: Oleksii KhvastunovPublisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
This dissertation investigates spatial competition between grocery retailers in the U.S. and grocery consumption patterns of households. It is organized as follows: In chapter one, I analyzed spatial competition between grocery retailers and importance of club stores for the grocery industry. In chapter two, I implemented structural demand model to understand determinants of household consumption in terms of healthiness. In chapter three, I used reduced form approach to investigate the importance of access to grocery stores for quantity and quality of household's consumption.