labor productivity and the law of decreasing labor content this paper analyzes labor productivity and the law of decreasing labor content ldlc originally formulated by farjoun and machover 1983 first it is shown that the standard measures of labor productivity may be rather misleading owing to their emphasis on monetary aggregates instead the conventional classical marxian labor values provide the theoretically and empirically sound measures of labor productivity the notion of labor content and the ldlc are therefore central in order to understand the dynamics of capitalist economies second some rigorous theoretical relations between different forms of proflt driven technical change and productivity are derived in a general input output framework with flxed capital which provide deterministic foundations to the ldlc third the main theoretical propositions are analyzed empirically based on a new dataset of the german economy

omnichannel management with consumer disappointment aversion abstract with the popularity of omnichannel retailing consumers are sophisticated enough to make strategic channel decisions considering the possible disappointment for an unexpected outcome induced by various uncertainties from online and offline channels value uncertainty online can trigger low value disappointment and availability uncertainty offline may cause stock out disappointment this study characterizes the effect of consumers anticipated disappointment aversion behavior on the optimal pricing decisions of retailers with or without inventory constraint in the omnichannel environment when a retailer operates in dual channel and faces offline inventory constraint the concern for consumers homogeneous disappointment aversion changes the threshold above which the retailer implement different channel pricing strategies then we show how the negative impact of disappointment on profit and market can be mitigated by physical showroom mechanism which is increasingly adopted by omnichannel management introduction of a cost effective physical showroom expands the market by relaxing the restriction of stock out disappointment and improves profit as long as consumers low value disappointment is high enough interestingly the low value disappointment benefits the omnichannel in expanding the market coverage by alleviating the constraint exerted by stock out disappointment further discussions regarding the disappointment behavior are derived from the extension of consumers heterogeneity in disappointment aversion

exploitation and time abstract this paper analyses exploitation and class formation in a dynamic context an intertemporal model of a subsistence economy is set up and among other results it is proved that in an interior equilibrium differential ownership of scarce productive assets is an inherent feature of a capitalist economy while exploitation tends to disappear in the long run asset inequality is therefore proved to be a normatively secondary though causally primary wrong it is also argued that these results raise several doubts about the possibility of providing robust micro foundations to marxian concepts by means of walrasian general equilibrium models

role of demand side strategy in quality competition abstract the research questions studied in this paper concern the role of demand side strategy for a firm engaged in duopolistic competition in quality and price a demand side strategy research looks towards markets and consumers unlike the traditional resource side strategy research that looks upstream into the firm s resources and its supply side we examine whether following a demand side strategy would benefit the firm the consumers or both in a market where two firms are competing with each other we first find the equilibrium quality and price levels for the traditional case where the two firms optimize their own profit function we use this case as a benchmark case for comparison next we let one firm the lower quality firm adopt a demand side strategy operationalized by an objective function where the profit is augmented by consumer surplus the equilibrium results show that a demand side strategy would increase the product quality level in the market and improve the adopter firm s competitiveness at the same time increasing the market consumer surplus we also study the case where the higher quality firm adopts demand side strategy and compare the results with the two cases mentioned above overall we find that adopting a demand side strategy would benefit the adopter firm s profitability and the consumers we therefore find evidence of what the strategy literature has been predicting about the role of demand side strategy

optimal dynamic auctions for revenue management we analyze a dynamic auction in which a seller withc units to sell faces a sequence of buyers separated intot time periods each group of buyers has independent private values for a single unit buyers compete directly against each other within a period as in a traditional auction and indirectly with buyers in other periods through the opportunity cost of capacity assessed by the seller the number of buyers in each period as well as the individual buyers valuations are random the model is a variation of the traditional single leg multiperiod revenue management problem in which consumers act strategically and bid for units of a fixed capacity over time for this setting we prove that dynamic variants of the first price and second price auction mechanisms maximize the seller s expected revenue we also show explicitly how to compute and implement these optimal auctions the optimal auctions are then compared to a traditional revenue management mechanism in which list prices are used in each period together with capacity controls and to a simple auction heuristic that consists of allocating units to each period and running a sequence of standard multiunit auctions with fixed reserve prices in each period the traditional revenue management mechanism is proven to be optimal in the limiting cases when there is at most one buyer per period when capacity is not constraining and asymptotically when the number of buyers and the capacity increases the optimal auction significantly outperforms both suboptimal mechanisms when there are a moderate number of periods capacity is constrained and the total volume of sales is not too large the benefit also increases when variability in the dispersion in buyers valuations or in the number of buyers per period increases

time to reject the privileging of economic theory over empirical evidence a reply to lawson the present financial and economic crisis has revealed a systemic failure of academic economics and emphasized the need to re think how to model economic phenomena lawson 2009 seems concerned that critics of standard models now will fill academic journals with contributions that make the same methodological mistakes albeit in slightly different guise in particular he is rather sceptical to use of mathematical statistical models such as the cvar approach as a way of learning about economic mechanisms in this paper i discuss whether this is a relevant claim and argue that it is likely to be based on a misunderstanding of what a proper statistical analysis is and can offer in particular i argue that the strong evidence of near unit roots and structural breaks in economic variables suggests that standard economic models need to be modified or changed to incorporate these strong features of the data furthermore i argue that a strong empirical methodology that allows data to speak freely about economic mechanisms such as the cvar would ensure that important information in the data is not over heard when needed adequately applied such models would provide us with an early warnings system signalling that the economy is moving seriously out of equilibrium

product quality and return policy in a supply chain under risk aversion of a supplier abstract this study aims to identify the relationship between return policy and product quality decisions in a decentralized system we consider a supply chain situation as in a retail or oem supply chain system where a buyer decides a return policy for consumers and delegates the product quality decision to a supplier we consider the supplier s different risk attitudes whether risk averse or risk neutral a penalty contract is introduced to control the supplier s hidden action conveying external failures due to returns to the supplier we show the conditions for supply chain coordination and demonstrate that product quality enhancement needs to precede a generous return policy setting in view of the prevalent business environment and current supply chain management practices moreover we indicate the optimal conditions for a generous return policy setting without quality enhancement

what is this school called neoclassical economics what is this school called neoclassical economics does it exist should it where does the term neoclassical economics come from and is there any connection between any of the current interpretations of the term and its original meaning how do we make sense of competing current interpretations is there a sustainable formulation these and related questions are raised and answered in an attempt to bring clarity to ongoing economic discussion and debate thereby to under labour for a more relevant academic economics discipline

intensity of competition and the choice between product and process innovation abstract two questions are examined within a model of vertical differentiation the first is whether cost reducing innovations are more likely to be observed in regimes of more intense bertrand or less intense cournot competition we find that there are cost reducing innovations that are pursued under cournot but not under bertrand competition the second is whether the regime of competition affects a firm s choice between product and process innovation we show that for the high quality firm whenever there is a difference between the choice made by a bertrand competitor and the choice made by a cournot competitor the former opts for product innovation while the latter prefers process innovation for the low quality firm the result is reversed

ontology and the study of social reality emergence organisation community power social relations corporations artefacts and money the conception of social reality i have previously defended and here extend positing features such as social relations positions and powers is thoroughly naturalistic and even consistent with modern interpretations of quantum field theory it also serves to ground a social science that can be scientific in the sense of natural science this is the thesis defended here central to the argument is an emphasis on a strong form of emergence and the category of organisation in process to bring out various salient features of the position defended i take the opportunity to compare aspects of it with relevant components of the contribution of john searle whose ontological conception appears at once to be both very similar yet also very different copyright the author 2012 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

formalising economics social change values mechanics and mathematics in economic discourse the mathematisation and formalisation of economic science has been one of the most important features of the development of economic science in the latter part of the twentieth century what were the causes behind this ubiquitous mathematisation of economic science recent scholarship places excessive emphasis on the role and prestige of mathematics as a scientific tool in this paper we argue this is inadequate not least because it fails to account for the whole classical era when mathematical economists failed to have any impact explaining this failure is one of the main aims of this paper most accounts focus mostly on the intellectual factors involved failing to do justice to what amounts to a multifaceted and complicated phenomenon involving social economic political intellectual normative and institutional factors partly redressing the balance by bringing to the fore the various factors involved is the other prime aim of this paper

what s in a name tony lawson on neoclassical economics and heterodox economics in this article i respond to tony lawson s what is this school called neoclassical economics lawson s paper is provocative because it reformulates neoclassical economics based on veblen s original intent as a mismatch created by recognising the value of an evolutionary approach to the economy whilst remaining over reliant on elements of a taxonomic approach for lawson many heterodox economists may be neoclassical under this description i argue that there is clearly a case to be heard but that the reformulation of the neoclassical raises a number of issues there are issues concerning the specific critique of the current usage of the term neoclassical regarding genealogy and meaning there are specific issues regarding the further development of the new old veblen definition of the neoclassical how clear is the definition in a practical context as a way to identify a neoclassical group based on the commitments of the critique and the definition what does it mean to be more realistic and what is the strategic value of such a provocation for heterodoxy i argue that the combination of these are reasons for more consideration of issues of social ontology not less insofar as the terms of the argument are incomplete and this invites both lawson and those he is criticising to progress the argument particularly on method

the dynamics of inequalities and unequal exchange of labor in intertemporal linear economies abstract introducing a concept of fairness of economic allocations namely exploitation as the unequal exchange of labor henceforth ue exploitation by generalizing roemer s 1981 1982a seminal models this paper aims to answer the following two questions in the context of an intertemporal economy with linear technology how is income and wealth inequality related or unrelated to the existence and persistence of ue exploitation what are the mechanisms driving the persistent existence of ue exploitation in growing economies agents are ue exploited resp exploiters if the amount of labor that they contribute to the economy is bigger resp smaller than the amount of labor received by them via their income it is proved first that ue exploitation is monotonically correlated to functional income inequality second it is shown that unless agents discount the future asset inequalities are necessary but not sufficient for the persistence of ue exploitation and capital accumulation leading to the disappearance of ue exploitation cannot be ruled out in equilibrium third it is shown that regardless of whether agents discount the future labor saving technical progress may yield sustained growth with persistent ue exploitation by keeping labor abundant relative to capital which restrains wages from rising unlike in models with differentiable production functions this mechanism does not rely on changes in the marginal productivity of inputs and it is entirely driven by the interaction between innovation and labor markets

the current economic crisis its nature and the course of academic economics the current crisis has triggered significant debate concerning economic theory and policy largely absent from this debate is an informed discussion of the methods used by economists in analysing the economy and formulating their proposals but method matters here i argue that current academic research practices need to be transformed before real insight can be achieved specifically i indicate why and how a more grounded framework than that presupposed by current research practices facilitates a potentially more fruitful approach to understanding the crisis

barriers to product return management in automotive manufacturing firms in malaysia the increasing of global warming and depletion of natural resources has become a concern for society government and industry there is a growing importance on recovery of used materials and products amongst industry players the malaysian government has conducted many green campaigns and provided incentives for some green practices however the adoption of product return and recovery management is still low amongst automotive manufacturers therefore it is important to understand the obstacles towards product return adoption so that the countermeasures can be thought of to overcome this situation the objective of this paper is to investigate the barriers of product return management amongst automotive manufacturing firms in malaysia a total of 228 automotive manufacturers and assemblers were identified as the sampling frame which was selected based on the census sampling method due to the limited sample size of the study the data was analysed using the partial least squares pls with the measurement model had shown sufficient model fit and the structural model revealed that the data supported the hypothesised model the large effect size and higher than zero values of the predictive capabilities imply that the model has sufficient variance explained for the predictive capability of the hypotheses testing of the study based on the results this study has found that the resource barrier has a significant effect on the level of adoption of product returns specifically the resource barrier and the extent of the manufacturing return adoption were positively related 0 361 p 0 01 resource barrier and the extent of the distribution returns 0 252 p 0 05 and resource barrier and the extent of the customer returns 0 333 p 0 01 the result reflects that automotive manufacturers have a lack of resources to afford the product return implementation as a matter of fact high initial investments in terms of finances human resources and time are required for the product return adoption other variables of the study such as the attitudinal and perception barrier information barrier and technical barrier were found to be insignificant with the adoption of product return management as a conclusion this study discovered that the resource barrier was the major obstacle that impeded the automotive manufacturers in malaysia from adopting the product return management the outcome is expected to help policy makers manufacturers as well as stakeholders in setting appropriate policies and strategies to improve the product return and recovery management adoption

consumer preferences and product and process r d firms often conduct both product and process r d consumer preferences typically play a vital role in determining these r d choices the economics literature however has mostly ignored the interrelationship between the r d choices of firms and consumer preferences istudy product and process r d from the perspective of their relationship with consumer preferences in doing so i find a novel distinction between the two kinds of r d this distinction can explain several empirical observations regarding firms choices of the two and can also potentially enable us to better empirically identify the two

actual labor values in a general model of production in contrast to counterfactual linear programming definitions of labor values this chapter introduces an at least equivalent definition of such values for the general case of joint production which is exclusively based on actual data this task is accomplished by extending marx s concept of individual values from multiple activities to joint production by means of certain price ratios at those points where production data are insufficient to ensure the positiveness of embodied labor time our approach generalizes the simple formula that relates labor values to monetary input output tables and it reformulates the labor theory of value in such a way that the theoretical priority of the case of a uniform composition of capital is reaffirmed in the concluding pages of his book marx s economics it is suggested by morishima that marxian economists ought radically to change their attitude towards the labor theory of value since in general the value system of the methods of production actually adopted in a capitalistic economy may be determined to be negative indefinite or even contradictory to the postulate of the uniform rate of exploitation morishima 1973 p 193 he then continues by proposing that optimal labor values the shadow prices of certain linear programming problems which minimize the amount of labor needed to produce given bundles of net output should take the place of actual labor values when production models of a more general kind than the simple leontief model are to be considered an interpretation of labor values which has been worked out in detail in morishima 1974 and has become a widely accepted approach to labor values and the labor theory of value for all types of multiple production systems

a dynamic model for optimal design quality and return policies abstract a clearly explained and generous return policy has been established as a competitive weapon to enhance sales from the firm s point of view a generous return policy will increase sales revenue but will also increase cost due to increased likelihood of return design quality of the product has been used as a competitive weapon for a long time this paper recognizes the relationship between design quality and price of the product and the firm s return policy quality level in the product would influence the amount of return directly when the product quality is higher the customer satisfaction rate will increase and the probability of return will decrease we develop a profit maximization model to jointly obtain optimal policies for the product quality level price and the return policy over time the model presented in this paper is dynamic in nature and considers the decisions as the product moves through the life cycle we obtain a number of managerial guidelines for using marketing and operational strategy variables to obtain the maximum benefit from the market we mention several future research possibilities

returns policy new model introduction and consumer welfare abstract this paper investigates how economic outcomes differ for new model introduction between two extreme contracts outright sales contract and returns policy contract with full credit under the outright sales contract we show that the retailer s incentive to introduce a new model can lead to a reduction of consumer welfare when the retailer is moderately risk averse the primary conclusion from this study is that the returns policy contract resolves this conflict between firms and consumers and that the supply chain introduces the new model only when consumer surplus from the new model is higher than that from the old model

one million miles to go taking the axiomatic road to defining exploitation this paper analyses the marxian theory of exploitation a general axiomatic approach is developed which is appropriate to study the concept of exploitation what it is and how it should be captured empirically two properties are presented that capture some fundamental marxian insights it is shown that contrary to the received view there exists a nonempty class of definitions of exploitation that preserve the relation between exploitation and profits called profitexploitation correspondence principle in general economies with heterogeneous agents complex class structures and production technologies with heterogeneous labour inputs however among the main approaches only the so called new interpretation satisfies the profitexploitation correspondence principle in general jel b51

manufacturer s return policies and retail competition manufacturers returns policies are a common feature in the distribution of many products the obvious rationale for returns policies is insurance practitioners not surprisingly have a different perspective and view returns as a cost of doing business in this paper we study the strategic effect of returns policies on retail competition and highlight its profitability implications for a manufacturer the setting for our research is the distribution of products with uncertain demand limited shelf lives and retail competition our objective is to provide a better understanding of when manufacturers should adopt returns policies the insights are obtained with a model based on the economics of strategy and decision making under uncertainty we show that when retailing is competitive and there is no uncertainty in demand a returns policy subtly induces retailers to compete more intensely the provision of a returns policy reduces retail prices without affecting wholesale prices thereby reducing retailer margins and improving manufacturer profitability the intuition is that with a returns policy cournot like levels of retail stocks cannot be sustained each retailer will order stocks so that it will not be constrained by stocks and so intensifying retail competition when however demand is uncertain and there is a single retailer a returns policy encourages the retailer to over stock and so decreases upstream manufacturer profits while the provision of a returns policy leads to lower retail margins the optimality of returns policy depends on the overall uncertainty and marginal cost a returns policy reduces the dispersion in retail prices between the high and low states of demand and the range of retail prices in the returns case is contained within the range of retail prices for the no returns case in the general setting when there are competing retailers and demand is uncertain there is a trade off for the manufacturer between the benefits more intense retail competition and the costs excessive stocking of a returns policy we find that a manufacturer should accept returns when the marginal production cost is sufficiently low and demand uncertainty is not too great to validate the results of our theory we conduct an empirical test with data from a major u s retailer the tests confirm our prediction that a returns policy intensifies retail competition and reduces retailer margins our theory and empirical test should interest practitioners and researchers in distribution especially those concerned with managing retail competition

learning innovation increasing returns and resource creation luigi pasinetti s original sin of and call for a post classical economics we draw on the seminal contribution to economics by luigi pasinetti respond to his call to reverse what he saw as the original sin of classical economists exacerbated by neoclassical economists namely the assumption of non increasing returns to scale and move towards building a post classical economics we outline the contours of a post classical framework that draws on key themes and contributions from pasinetti on learning technical progress increasing returns resource creation trade and catching up and contributions from within and without economics that are in line with lend support to and challenge it we advocate the pressing need and opportune timing for a concerted effort to revitalise ideas from the once vibrant cambridge school of economics and help develop a fresh more pluralist and inclusive post classical economics that cuts across divides and opens up opportunities for a less dismal science

sraffa s system equal rate of profits and the notion of center of gravitation abstract this paper argues that the condition of uniform rate of profits in sraffa s system is not based on his implicit assumption that the system is at the equilibrium or the center of gravitation it is rather a logical requirement of a reproducing system of basic goods as long as prices are not imposed from outside the system this condition holds irrespective of supplies being equal to their respective effectual demands it conjectures that sraffa could have arrived at this conclusion through his analysis of the standard system on the basis of this result a critique of the received interpretation led by garegnani of sraffa s prices is developed

heterogeneous or homogeneous quantity competition abstract every homogeneous goods cournot model is payoff equivalent to a heterogeneous goods model we characterize when the converse is true for linearly separable and multiplicatively separable models these results have implications that blur the distinction between process and product innovations

value price and exploitation the logic of the transformation problem this paper tries to clarify the logical structure of the relationship between labor values and prices from an axiomatic perspective the famous transformation problem is interpreted as an impossibility result for a specific interpretation of value theory based on specific assumptions and definitions a comprehensive review of recent literature is provided which shows that there are various theoretically relevant and logically consistent alternative interpretations based on different assumptions and definitions

the possibility of social choice the subject of social choice includes within its capacious frame various problems with the common feature of relating social judgments and group decisions to the views and interests of the individuals who make up the society or the group some challenges and foundational problems faced by social choice theory as a discipline are discussed social choice theory is a subject in which formal and mathematical techniques have been very extensively used voting based procedures are entirely natural for some kinds of social choice problems such as elections referendums or committee decisions they are however altogether unsuitable for many other problems of social choice impossibility results in social choice theory led by the pioneering work of arrow 1951 have often been interpreted as being thoroughly destructive of the possibility of reasoned and democratic social choice including welfare economics that view is argued against

class and exploitation in general convex cone economies abstract in this paper we examine what appropriate formulations for labor exploitation are in order to explain the emergence of class and exploitation status in capitalist economies given the well known controversy pertaining to plausible formulations for labor exploitation in joint production economies we propose an axiom axiom for labor exploitation le which every appropriate formulation of labor exploitation should satisfy using this axiom the necessary and sufficient condition for plausible formulations of labor exploitation is characterized to verify class exploitation correspondence principle cecp roemer 1982 according to this cecp no longer holds in general convex cone economies if the well known formulations of labor exploitation such as morishima 1974 and roemer 1982 chapter 5 are applied therefore we propose two new definitions of labor exploitation each of which verifies cecp

asymptotic properties of a leontief economy abstract in this paper we discuss the asymptotic properties of equilibrium quantities of a leontief economy when agents have additively separable utilities we estimate the rate of growth of equilibrium quantities and prices that either tend to zero or infinity or remain bounded below and above by strictly positive vectors in the case of homogeneous preferences we prove that the quantities of any equilibrium converge to those of an equilibrium that grows at a constant rate

the contemporary relevance of a cambridge tradition economics as political economy political economy as social theory and ethical theory in this review essay i set out key aspects of nuno martins the cambridge revival of political economy in so doing i also provide some comments on the current state of economics since these provide some context for an appreciation of what martins is trying to achieve martins is focused on making the positive case for classical political economy cpe as a form of theory that is quite different from the modern mainstream for martins that difference is based on its approach to the distribution of a surplus expressed through a social ontology that is based on historical open systems and in which the key aspect of open systems is the institutional and hence deliberative activity by which the surplus is decided which is ultimately an issue for ethics it is through a cambridge tradition focusing on sraffa keynes lawson and sen that cpe a classical social theory and ethical deliberation are brought together bringing them together is an act of synthesis and i conclude by providing a constructive critique of the terms of this synthesis

a differential game theoretic model for duopolistic competition on design quality in this paper we propose a differential game theoretic model to analyze the design quality and pricing decisions for a product over the product life cycle the market is represented as a duopoly where our product competes against a similar product marketed by our competition the duopolistic competition is modeled as a two player nonzero sum noncooperative game the resulting control theoretic model is solved under certain functional assumptions to describe the nash equilibrium strategies of the two competitors finally observations made on an extensive set of numerical experimentations over a variety of model parameters are summarized into a set of relevant managerial guidelines on developing design quality and pricing strategies

the neo ricardians focuses on the neoclassical theory of economics in great britain calculation for the standard commodity assumptions of piedro sraffa on the cycle of production functions of the rate of return ebsco

note the role of returns policies in pricing and inventory decisions for catalogue goods manufacturers often use returns policies to encourage retailers to stock and price items more aggressively we focus on the effect that such policies have on both a retailer s and a manufacturer s profits when the retailer must commit prior to the selling season to both a stocking quantity and a price at which to sell an item such a commitment is often necessary for retailers who sell primarily through catalogues

process order and stability in veblen this is the accepted manuscript version the final version is available from oup at http cje oxfordjournals org content early 2014 09 30 cje beu045 abstract

heterogeneous labour and the fundamental marxian theorem as was pointed out by morishima at the end of his famous book on marx s economics the heterogeneity of labour is a serious dilemma for marx s theory of exploitation especially for the so called fundamental marxian theorem the problem which should be separated from the peculiarities of joint production consists in finding an appropriate reduction of the various types of labour to one common unit recently bowles and gintis have undertaken an interesting reformulation of the marxian theory of value with respect to heterogeneous labour by avoiding any reduction at all bowles and gintis 1977 1978 cf also steedman 1977 holliinder 1978 but for the purpose of the fundamental marxian theorem this only shifts the problem from the heterogeneity of labour to the heterogeneity of the respective rates of exploitation the aim of the present paper is to extend the fundamental marxian theorem without joint production from homogeneous to heterogeneous labour section 3 this extension is based on a new concept called the standard reduction of labour because of its dual relationship to sraffa s standard commodity section 2 for some arguments a certain type of matrices called sraffa matrices is needed which generalize the quasiirreducible matrices as introduced by bowles and gintis appendix standard reduction implies always a uniform rate of exploitation whereas the same is true for the reduction by wage rates only in special cases for example uniform consumption labour inputs only prices proportional to labour values for the first two cases cf morishima 1978 hence in general standard reduction and reduction by wage rates are different

on the evolution of thorstein veblen s evolutionary economics this article addresses the origins of thorstein veblen s evolutionary economics as announced in his 1898 essay why is economics not an evolutionary science before 1897 and partly under the influence of c lloyd morgan veblen rejected biological reductionism veblen s 1897 endorsement of a critique of marxism by max lorenz shows that he found karl marx s account of human action too limiting by this time veblen had also rejected the idea of either the individual or society as exclusive foundations for social science instead he embraced an evolutionary framework of explanation along darwinian lines involving multiple levels of explanation and emergent properties copyright 1998 by oxford university press

strategic wholesale pricing in a supply chain with a potential entrant this paper develops an adverse selection model for a two stage supply chain with one supplier one retailer and a potential outside entrant supplier who makes a partially substitutable product the work is different from most research on entry deterrence that only considers a single stage model our main interest is to investigate how the incumbent supplier can strategically maximize her profit by a wholesale pricing policy when facing the potential entrant we focus on a model where the entrant supplier will sell her product through the same incumbent retailer we derive the optimal decisions for each player and study the comparative statics of the equilibrium to investigate how the supply chain structure may affect the deterrence strategy of the incumbent supplier we also consider three alternative models with different channel structures when both suppliers sell their products directly when the entrant has another independent retailer and when the entrant sells her product directly through the comparison we find that the existence of the common downstream retailer often enhances the deterring motivation of the incumbent supplier

the effect of return and price adjustment policies on a retailer s performance abstract product returns cost retailers billions of dollars annually consumers return products they are dissatisfied with and may return and repurchase products in order to obtain a discount when temporary price drops occur in this paper we analyze the effect of return policies durations on retailers who offer periodic discounts and those that do not we also examine the effects of offering a price adjustment protection policy and its optimal duration we compare policies in which money back refunds are given versus those where noncash refunds e g gift cards are used we find that using noncash refunds can significantly reduce the cost of providing a return policy and may even make such a policy profitable we also find that for retailers who already offer consumers periodic price discounts offering a price adjustment policy with the same duration as the return policy can be optimal and can considerably reduce the cost of the return policy the later assertion holds even if the price adjustment protection does not lead to an increase in demand

a progress report on marxian economic theory on the controversies in exploitation theory since okishio 1963 this report explores the development of exploitation theory in mathematical marxian economics by reviewing the main controversies surrounding the proper definition of exploitation since the contribution of okishio the report first examines the debates on the fundamental marxian theorem and class exploitation correspondence principle developed mainly in the 1970s and 1980s followed by the property relation theory of exploitation by roemer then the more recent exploitation theory proposed by vrousalis and wright is introduced finally the report introduces and comments on recent axiomatic studies of exploitation by focusing on the work of veneziani and yoshihara

demand uncertainty and returns policies manufacturers facing uncertain demand may induce distributors to carry ample stocks of their products by agreeing to accept returns of unsold goods for credit the authors model the manufacturer s decision to accept returns showing that this decision depends crucially on the nature of the demand uncertainty uncertainty over customer arrivals favors returns while uncertainty over consumers valuation of the manufacturer s product leads distributors to set retail prices too high from the manufacturer s standpoint when returns are allowed the authors show that returns can be expected to raise retail prices while maintaining shrinking distributor margins copyright 1995 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

integrating social conflict into economic theory the generalisation of coasian theorem to the power relationship amounts to depicting conflict as a bargaining process between conflictual parties that are simultaneously both partners and adversaries this perspective leads to different models of rational conflicts i e a threat of conflict without any real clash an alternative approach is developed by different models inspired by the public choice school which build upon the logic of coercive power within the framework of a self interested behaviour the integration of social conflicts in a narrowly defined individual cost benefit theoretical framework has resulted in reducing social conflict to real private but not social conflict in other words economic theory has considered social protesters either as potential or actual looters but rarely as a group of people struggling for a common cause integration of social conflict into economic theory will require i abandoning the ubiquitous market model when describing conflictual relationships ii accepting the logic of force or coercive power as a starting point and iii expanding the idea of interest to include encompassing including class interest

the nature of heterodox economics heterodoxy serves as an umbrella term to cover the coming together of separate projects or traditions in answering the question what distinguishes heterodoxy from the orthodoxy the author argues that matters of ontology are central in answering the question how are the various traditions that make up the modern heterodoxy to be distinguished from each other the author defends criteria other than varying commitments to specific substantive theories policy measures or techniques or basic units of analysis