modelling the domestic and foreign tourist arrivals to tamil nadu india in recent years due to the indian federal government s and tamil nadu state government s various initiatives and promotional activities foreign and domestic tourist arrivals in tamil nadu are on the increase this article aims to model the monthly tourist arrivals foreign as well as domestic in tamil nadu for monthly time series data during the period 1998 to 2002 using univariate time series models as both time series show strong seasonal patterns we also investigate the possibility of seasonal unit roots in the domestic and foreign tourist arrivals series the results show that significant growth in domestic and foreign arrivals takes place during the months december to january growth rate for domestic tourist arrivals is positive during april and may but is negative for the foreign tourist arrivals during april and insignificant during may such information would be very useful to the tamil nadu government and the tourism industry in maximizing the usage of available tourist spot infrastructure

measuring heterogeneous reservation prices for product bundles this paper develops a model for capturing continuous heterogeneity in the joint distribution of reservation prices for products and bundles our model is derived from utility theory and captures both within and among subject variability furthermore it provides dollarmetric reservation prices and individual level estimates that allow the firm to target customers and develop customized and nonlinear pricing policies our experiments show that regardless of whether the products are durables or nondurables the model captures heterogeneity and predicts well models that assume homogeneity perform poorly especially in predicting choice of the bundle furthermore the methodology is robust even when respondents evaluate few profiles self stated reservation prices do not have any informational content beyond that contained in the basic model the direct elicitation method appears to understate overstate the variation in reservation prices across consumers for low priced high priced products and bundles hence this method yields biased demand estimates and leads to suboptimal product line pricing policy the optimization results show that the product line pricing policy depends on the degree of heterogeneity in the reservation prices of the individual products and the bundle a uniformly high price strategy for all products and bundles is optimal when heterogeneity is high otherwise a hybrid strategy is optimal

getting the safe minimum standard to work in the real world a case study in moral pragmatism abstract there is growing endorsement of local stake holder conventions to resolve unusual environmental disputes the conventions are separate decision making bodies designed to by pass conventional institutions the hazards of a stake holder convention which is overly detached from conventional decision making leads to a discourse that never successfully confronts the value controversies which the stake holder convention is charged to resolve a case study uncovers obvious and robust strategic manipulations of stake holder conventions that intrude on value dialogue an appeal to the safe minimum standard rules of ciriacy wantrup updated to engage this question successfully corrects some of the more egregious stumbling blocks to good faith dialogue in local discourse the proposed constraints on the stake holder convention can be quite directive authoritative and bureaucratic yet the constraints are necessary to preserve good faith conduct within the dialogue

the influence of price discount framing on the evaluation of a product bundle bundle offers consisting of two or more products often include a price discount the impact of the price discount on the perceived attractiveness of the bundle has been shown to depend on which product is discounted it has been argued that discounts are more effective when they are assigned to the product that will receive the most weight in the overall evaluation of the bundle we propose that the perceived value of the discount may also depend on a referent specific to each product six studies are used to provide evidence that 1 price discount framing effects can be explained by reference dependence and 2 that reference dependence and product importance independently contribute to price discount framing effects

a piecewise linear approach to modeling and forecasting demand for macau tourism abstract in this paper we construct and use a piecewise linear method to model and forecast on a monthly basis the demand for macau tourism data over the period january 1991 december 2005 and a seasonally adjusted series for tourism demand are used the study examines 4 forecasting horizons ranging from 6 to 24 months in advance mean absolute percentage errors and root mean square errors are adopted as criteria for evaluating the accuracy of the forecasting exercises finally the forecasts of piecewise linear model are compared with those of autoregressive trend model seasonal autoregressive integrated moving average and its arch rival fractionally integrated autoregressive moving average models the piecewise linear model is more accurate than the three benchmark models tested and the improvement is practically significant

the rationality of a safe minimum standard the safe minimum standard sms is a policy shift to safety defaults to forestall irreversible outcomes critics charge an inconsistency what justifies business as usual cannot also justify switching to the sms currently the sms is only a procedural shift where economic optimality procedures are buttressed by extra special focus on uncertainty yet social welfare function may not be complete enough warranting a more fundamental sms shift numerous moral positions support this sms approach this sms also operationalizes the intolerable cost as a trigger point noting societies with lower tolerance for sacrifice must trigger the sms earlier

forecasting u s tourist arrivals using optimal singular spectrum analysis this study examines the potential advantages of using singular spectrum analysis ssa for forecasting tourism demand to do this it examines the performance of ssa forecasts using monthly data for tourist arrivals into the unites states over the period 1996 to 2012 the ssa forecasts are compared to those from a range of other forecasting approaches previously used to forecast tourism demand these include arima exponential smoothing and neural networks the results presented show that the ssa approach produces forecasts which perform statistically significantly better than the alternative methods in forecasting total tourist arrivals into the u s forecasts using the ssa approach are also shown to offer a significantly better forecasting performance for arrivals into the u s from individual source countries of the alternative forecasting approaches exponential smoothing and feed forward neural networks in particular were found to perform poorly the key conclusion is that singular spectrum analysis ssa offers significant advantages in forecasting tourist arrivals into the us and is worthy of consideration for other forecasting studies of tourism demand

how to decide when experts disagree uncertainty based choice rules in environmental policy environmental economists have traditionally addressed the issue of choice under uncertainty by applying the expected utility hypothesis when policymakers face a panel of experts with widely divergent beliefs the problem may more accurately be described as a case of choice under pure uncertainty arrow and hurwicz 1972 demonstrate that rational choice criteria under pure uncertainty will focus on the extremes of the state space not the midpoint as is typically assumed using nordhaus s dice model uncertainty based choices about global warming policies are evaluated linkages to the safe minimum standard and the precautionary principle are also discussed

tourism demand modelling and forecasting a review of recent research abstract this paper reviews the published studies on tourism demand modelling and forecasting since 2000 one of the key findings of this review is that the methods used in analysing and forecasting the demand for tourism have been more diverse than those identified by other review articles in addition to the most popular time series and econometric models a number of new techniques have emerged in the literature however as far as the forecasting accuracy is concerned the study shows that there is no single model that consistently outperforms other models in all situations furthermore this study identifies some new research directions which include improving the forecasting accuracy through forecast combination integrating both qualitative and quantitative forecasting approaches tourism cycles and seasonality analysis events impact assessment and risk forecasting

tourists acceptance of euro pricing conjoint measurement with random coefficients abstract pricing in the new european currency may have an influence on how consumers perceive a travel package and the company selling it the paper introduces a set of interconnected explanatory variables which determine the influence of euro pricing versus pricing in local currency an empirical study employs the second generation structural equation modelling to perform random coefficient estimates for the part worth coefficients in a conjoint measurement design

product line rivalry and market segmentation with an application to automobile optional engine pricing this paper addresses the questions whether and when the pricing practices on base products may differ from those of premium products sold with options or add ons various alternative models are considered a monopoly model a model of brand rivalry with full consumer information and a model of rivalry in which consumers are only well informed about base product prices only the brand rivalry model with limited consumer information predicts that premium products have larger percentage markups than base products provided that brand rivalry is sufficiently intense empirical evidence on base and premium product pricing in the automobile market is consistent with the limited information model and inconsistent with the other two models

joint bidding in the name your own price channel a strategic analysis in this paper we study the name your own price nyop channel we examine theoretically and empirically whether asking consumers to place a joint bid for multiple items rather than bid one item at a time as practiced today can increase nyop retailers profits relatedly we also examine whether allowing consumers to self select whether to place a joint bid or itemwise bids increases retailers profits and consumers surplus we construct a dynamic model that incorporates both demand uncertainty and supply uncertainty to address these issues our theoretical analysis identifies the conditions under which joint bidding can increase both nyop retailers profits and consumers surplus we find that some consumers might bid more for the very same items when they place joint bids the increase in bid amount is related to the fact that joint bidding reduces the chance of mismatch between nyop retailers costs and consumer bids we conducted a laboratory study to assess the descriptive validity of some of the

a probabilistic approach to pricing a bundle of products or services the authors propose a probabilistic approach to optimally price a bundle of products or services that maximizes seller s profits their focus is on situations in which consumer decision making is o

incorporating distributional considerations in the safe minimum standard approach endangered species and local impacts abstract explicitly incorporating current distributional concerns into the safe minimum standard sms approach is the objective of this study the sms approach is a collective choice process that prescribes protecting a minimum level of a renewable natural resource unless the social costs of doing so are somehow excessive or intolerably high more complete implementation of an sms approach if it is to be a pragmatic policy tool requires that distributional considerations be included in determining whether the economic consequences of preservation actions are intolerable two case studies involving the us endangered species act are used to illustrate how distributional concerns might be incorporated into the sms approach

how buyers evaluate product bundles a model of anchoring and adjustment how do buyers evaluate a bundle of items the most common approach in earlier economic analyses see e g adams and yellen 1976 schmalensee 1984 was to start with the additivity assumption the overall utility of a bundle equals the sum of the bundle items individual utilities the restrictiveness of this additivity assumption was later recognized and removes dansby and conrad 1984 guiltinan 1987 hanson and martin 1990 however the question of how buyers evaluation processes may account for additivity or a lack thereof has remained largely unexplored

a management orientated approach to combination forecasting of tourism demand abstract volatility exponential smoothing regression and naive 2 models are considered singly and in combination in terms of forecasting demand for international tourism these models generate accurate predictions of tourism flows but their prime utility is when combined with other models usually models are combined by means of purely statistical criteria we show that goal programming gp offers an alternative flexible approach to model combination gp offers planners a practical solution to tourism forecasting problems since the method is more adaptable than conventional minimisation of prediction error by permitting practitioners to prioritise a series of management related goals forecasters can focus on longer and short term goals minimising forecast under and over estimation and or concentrate on prediction errors in tourism flows at various times of the year

are output growth rate distributions fat tailed some evidence from oecd countries this work explores some distributional properties of aggregate output growth rate time series we show that in the majority of oecd countries output growth rate distributions are well approximated by symmetric exponential power densities with tails much fatter than those of a gaussian fat tails robustly emerge in output growth rates independently of i the way we measure aggregate output ii the family of densities employed in the estimation iii the length of time lags used to compute growth rates we also show that fat tails still characterize output growth rate distributions even after one washes away outliers autocorrelation and heteroscedasticity

research note competitive bundling and counterbundling with generalist and specialist firms bundling which is the practice of selling two or more products or services in a package is a pervasive marketing practice and is often used as a strategic competitive tool however there has not been enough consideration of competitive bundling situations in which exit of a competitor is not a concern in this paper we address this issue by identifying conditions under which strategic competitors may or may not resort to bundling when competitor exit considerations are absent we study competition between a multiproduct generalist firm and two single product specialist firms in two product categories one of which has undifferentiated products and the other has differentiated products in our model the specialist firms can form an alliance to bundle their products in competing with the generalist firm in contrast to the previous literature we find that concurrent bundling by competitors if it occurs in equilibrium is profitable we also find that when one competitor bundles and the other does not the bundling firm gains a greater share of customers and makes a higher profit however when conditions favor counterbundling by a competitor such counterbundling helps the competitor retain its customers finally we note that under other market conditions concurrent bundling by competitors escalates price competition to the extent that retaining customers through bundling is not profitable in such a case we show that strategic competitors are better off having asymmetric product lines with one competitor bundling and the other selling unbundled

real time forecasting regional tourism with business sentiment surveys abstract this study provides evidence that supply side soft information retrieved from business surveys is effective in real time forecasting of hotel arrivals at the regional level we assess the effect of including business sentiment indicators in commonly used naive specifications and structural time series models using residuals and predictive diagnostics we find that both the goodness of fit and the forecasting accuracy of the augmented models are superior to those of the baseline models whence the opportunity to extend to the tourism sector the surveys on the business sentiment currently realized by the provincial chambers of commerce for the manufacturing sector allowing an effective and timely managing of local tourism market where official information is likely to be either lacking or poor in quality

the value of biodiversity markets society and ecosystems the value of biodiversity is discussed at different levels including market value non market values to humans and the value of biodi versity to ecosystems the main conclusion is that although market exchange values of environmental services may be used to justify biodiversity protec tion measures it must be stressed that exchange value constitutes a small portion of total biodiver sity value the total value of existing biodiversity is largely unknown but indications are that it is essen tial to human existence the various levels of biodi versity value point to the need for a hierarchical and pluralistic methodology to determine appropri ate policies for its preservation jel q21 i introduction among ecologists there is a general con sensus that biodiversity1 is of critical impor tance to the health of ecosystems and even for the long term survival of the human species there is also a consensus that bio diversity is being lost at a rate which is a cause for concern 2 economists on the other hand generally view biodiversity as just an other good which is to be placed in the basket of market choices just as any other the discussion of the specifics of biodiver sity policy has been unsatisfactory partly because of the different meanings of the word value used by economists and ecolo gists many ecologists fail to understand the logic of market allocation and why biologi cal resources are used in seemingly irra tional ways many economists fail to ap preciate the narrowness of the concept of economic value as indicated by relative prices determined by market exchange fol lowing anderson 1966 and brown 1984 the discussion below considers economic measures of value to be species of the genus assigned value which belongs to the family value many biologists and paleontologists be lieve that we are at a critical point in the history of the human species and perhaps even in the 600 million year history of com plex multicelled life on earth if the paleon tologists and biologists who study the phe nomenon of mass extinction are correct the current human induced mass extinction may be of the same order of magnitude as the five other major extinction episodes which destroyed between 20 and 96 percent of existing species on the planet ehrlich and ehrlich 1992 ward 1994 wilson 1992 we are living in a truly remarkable period in earth s 41 billion year history the valua tion decisions our species has made in the recent past and will make during the next few decades will determine the fate of life on earth for the next tens of millions of years it is critical to clarify the language and concepts we use to estimate the value of biodiversity and thus policies leading to its destruction or preservation the importance attached to the issue of biodiversity preservation necessarily in volves ethical judgments about duty to fu ture generations and responsibility toward the nonhuman natural world although in dividuals hold a variety of conflicting beliefs about human responsibility to the natural world this does not mean that policy choices

modelling and forecasting australian domestic tourism abstract in this paper we model and forecast australian domestic tourism demand we use a regression framework to estimate important economic relationships for domestic tourism demand we also identify the impact of world events such as the 2000 sydney olympics and the 2002 bali bombings on australian domestic tourism to explore the time series nature of the data we use innovations state space models to forecast domestic tourism demand combining these two frameworks we build innovations state space models with exogenous variables these models are able to capture the time series dynamics in the data as well as economic and other relationships we show that these models outperform alternative approaches for short term forecasting and also produce sensible long term forecasts the forecasts are compared with the official australian government forecasts which are found to be more optimistic than our forecasts

gaussian demand and commodity bundling in an important and widely cited essay adams and yellen 1976 examine the use of package selling as a price discrimination device they consider a monopolist producing two goods with constant unit costs and facing buyers with diverse tastes the marginal utility of a second unit of either good is assumed to be zero for all buyers the two goods are independent in demand for all buyers so that any buyer s reservation price for the first unit of either good is independent of the market price of the other thus the maximum amount any buyer would pay for a bundle consisting of one unit of each good is the sum of the two reservation prices and buyers are completely described by the values of those two prices 2 resale markets are assumed away in order to obtain comparative results for alternative pricing strategies the distribution of reservation prices in the adams yellen framework is assumed to be bivariate normal implications of gaussian demand are explored pure bundling is shown to operate by reducing buyer diversity thus facilitating the capture of consumers surplus it generally makes buyers worse off than unbundled sales it is more profitable if average reservation prices are high enough mixed bundling combines advantages of both pure bundling and unbundled sales and it is generally strictly more profitable than either bundling which treats goods symmetrically seems most attractive under symmetric reservation price distributions i am indebted to severin borenstein for superb research assistance to the ford motor company for research support through a grant to m i t and to the harvard economics department for housing me as a visiting scholar while most of this research was performed of course only i can be held responsible for this essay s shortcomings 1 the first clear recognition of this possibility seems to have been by stigler 1968 but also see burstein 1960 2 paroush and peles 1981 relax the assumption that consumers purchase at most one unit of each good but they consider only two types of buyers both with linear demand functions they retain the assumption that demands are independent for all buyers telser 1979 and phillips 1981 use different frameworks to analyze bundling policies spence 1980 explores the relation between bundling across commodities as here and bundling multiple units of the same

insiders vs outsiders in the hotel sector we investigate whether entering an official hotel classification system is as lucrative as suggested in the tourism management literature indeed in countries in which the official hotel classific

a combined monopoly and optimal packaging this paper specifies the conditions under which a profit maximizing monopoly will market a package of two different commodities even when the demands for and the cost of production of each commodity are entirely independent of the other packaging is here a useful way of implicitly discriminating by price especially when explicit price discrimination is not possible some of the welfare applications are discussed

a hybrid conjoint model for price demand estimation abstract recent developments in conjoint analysis include the introduction of hybrid models in which part worths estimated from self explicated data are combined with information obtained from full profile evaluations this paper extends the hybrid approach to conjoint problems entailing multiple suppliers with particular emphasis on competitive price relationships

bundling subscription tv channels abstract i analyze a market such as a subscription tv market where multiple varieties of an excludable public good are traded in bundles here bundling is not due to a producer s desire to extract consumers surplus but due to economies of scope in distribution technology the paper studies the pricing and production decisions of a supplier as well as the impacts of certain regulations such as pure bundling or pure components pricing restrictions findings of interest are as follows a profit constrained welfare maximizer would use a pure bundling price system when costs are low and a mixed bundling price system when costs are high a private monopolist produces too few varieties a pure bundling restriction on a private monopolist may increase welfare and consumer surplus but a pure components restriction never increases them

importance and threat as determining factors for criticality of natural capital abstract an important issue in the debate about the use and conservation of natural ecosystems is the degree to which these ecosystems and their functions should be considered critical this paper presents some guidelines to determine the criticality of natural capital based on two main criteria the first criterion is the importance of natural ecosystems ecological socio cultural and economic and the second is the degree of threat based on the quantity and quality of the remaining natural areas in a given region it is argued that the two criteria are complementary and need to be taken into account simultaneously when determining the criticality of natural capital finally the paper presents and discusses some possibilities for the development of a critical natural capital index for europe

a comparison of three different approaches to tourist arrival forecasting abstract forecasting plays a major role in tourism planning the promotion of tourism projects involving substantial sums of money requires an estimate of future demand and market penetration the commitment to developing tourism would be much easier if it were possible to analyse current and past tourist traffic and predict the nature of changes in tourism demand these extrapolative approaches to forecasting require historical data this paper investigates the application of three time series forecasting techniques namely exponential smoothing univariate arima and elman s model of artificial neural networks ann to predict travel demand i e the number of arrivals from different countries to hong kong exponential smoothing and arima are two commonly used statistical time series forecasting techniques the third approach neural networks is an artificial intelligence technique derived from computer science according to the analysis presented in this paper neural networks seems to be the best method for forecasting visitor arrivals especially those series without obvious pattern

the forecasting of international expo tourism using quantitative and qualitative techniques this study predicts the number of visitors to an international tourism expo to be held in korea in 2012 an unprecedented event for the host city forecasting demand for such a mega event has received only limited attention in the literature unlike most studies forecasting international tourism demand forecasting expo demand involves using both quantitative forecasting models and qualitative technique because of data limitations combining quantitative techniques with willingness to visit wtv surveys predicts the expo demand at 8 9 million visitors in comparison using the delphi method experts predict expo demand at 6 8 million visitors for this study the delphi method provides more conservative estimates than estimates from combining quantitative techniques with wtv policy implications presented are directed toward expo planners and practitioners in terms of demand and supply side application of these results in the decision making process and future challenges surrounding demand forecasting

products with branded components an approach for premium pricing and partner selection an increasing number of products are being sold with components that themselves are brand names examples are personal computers with intel microprocessors and diet soft drinks that use the nutrasweet formulation branded components may alter consumers valuation of the bundle necessitating changes in the ways firms identify and price such bundled products surprisingly the existing marketing literature is silent on this issue the purpose of our paper is to propose an analytical approach that helps marketers of products with branded components make optimal pricing and partner selection decisions our managerial objectives are twofold a to the seller of the bundled product we suggest the optimal bundled product offering optimal selling prices of alternative products revenues and profits and b to the branded component manufacturers we indicate the most favorable alliance partners and payoff gains losses of aligning with other branded components instead of unbranded alternatives our analytical approach is also likely to be helpful to academics researching bundling and ingredient branding issues the specific problem modeled assumes the bundled product has two components that are consumed jointly furthermore each component can be either a brand name or unbranded in this model the consumer has no control over the choice of the components in the bundle the seller decides what form of bundle components i e branded or unbranded to offer we assume that the product that is marketed eventually enjoys a monopoly drawing from research in signaling and brand alliance we posit each branded component may either enrich or suppress the value of the partnering component in the bundle as perceived by the consumers our approach has three methodological stages first we build an individual level model to assess the valuation of alternative products and their principal components at the level of a randomly drawn consumer to do so we rely primarily on the theory of reservation prices and weber s theory on price value changes second we aggregate such valuation across consumers to assess the market s overall valuation for this purpose we invoke parametric distributions based on integral transform theory third we develop payoff functions based on market valuation of alternative products and supply side costs the managerial objectives are met based on results from this stage our approach was successfully applied to the context of a university bookstore that intends to sell windows based laptop computers the two principal components of the laptop computer bundle are the microprocessor chip and the personal computer platform on which the chip is implanted the seller may choose either compaq with intel inside or a simpler bundle featuring one of these with an unbranded complementary component or an entirely unbranded bundle we used data collected from 192 potential consumers via a survey included in the survey were measures of consumers perceptions of functional aspects of the components and their reservation prices for alternative bundled products the approach identified the most profitable bundle for the seller and its optimal price it also provided estimates of the revenue impact of the gain or loss for each branded component by partnering the other branded component instead of the unbranded alternative as such the model facilitates the determination of the optimal price price premium and profits for products with branded components as well as the identification of the ideal partner for each branded component manufacturer it is apt to caution that products with branded components need not always lead to price premiums or lead to win win outcomes reasons such as incongruity between the branded components or domination of one of the components over the other may drive potential consumers away thus hurting profits implications of the results to negotiate component prices are discussed in the paper the study limitations and directions for future research are also presented

chapter 11 pricing models in marketing publisher summary this chapter brings together a set of diverse efforts in the recent literature on the modeling of price decisions and related questions in marketing there has been an impressive growth in the array of topics investigated in the literature various trends in the development of pricing models are evident from the foregoing review first one trend has been to develop theoretical models to describe observed pricing strategies in the marketplace and to derive conditions under which certain strategies are optimal this trend is clearly evident when one considers the area of dynamic pricing models another trend is an attempt to develop pricing models in which certain aspects of consumer behavior e g asymmetric response to price increases versus price decreases are incorporated this development is quite recent and does offer a large potential a third dominant direction is the use of game theoretic models for developing equilibrium pricing strategies

uncertainty risk aversion and the game theoretic foundations of the safe minimum standard a reassessment abstract contrary to a widely held perception game theory can provide a consistent and rigorous economic justification for the safe minimum standard sms constraint on economic development s v ciriacy wantrup 1968 based the sms on the idea that risk aversion is an important public policy motive and richard bishop 1978 tried to theoretically justify this idea 20 years ago by applying the minimax decision rule to an insurance loss avoidance game theoretic model more recently richard ready and bishop 1991 distinguished two different games against nature and determined that the minimax rule implied opposite choices for preservation for development in the models and therefore game theory could not provide a consistent rationale for the sms ready and bishop s two games can be viewed as subgames of a more comprehensive dynamic game of society against nature the minimax decision rule yields contrary results because the two subgames embody different kinds of uncertainty further the minimax rule both ignores the social cost of wrong choices and violates milnor s bonus invariance axiom for game theoretic decision rules milnor j 1964 a minimax regret decision rule is preferred because it emphasizes risk aversion while explicitly incorporating the opportunity cost of making a wrong choice between preservation and development the rule gives rise to a consistent choice of preservation over both the insurance and lottery games and transfers the burden of argument from preservationists to developers on the other hand the sms constraint on development is contingent on the size of development benefits foregone and thus is not absolute and binding

conjoint analysis of price premiums for hotel amenities over the past decade or so conjoint analysis green and rao 1971 johnson 1974 appears to have become one of industry s most widely applied marketing research techniques for estimating consumer s multi attribute utility functions cattin and wittink 1982 however a continuing problem in application of conjoint analysis is how to handle the price attribute in the construction of stimulus profiles for presentation to respondents in many cases of practical interest the price level will be highly correlated with other product attribute levels if the researcher ignores this correlation by allowing the price levels to vary independently of other attributes the resulting profiles may appear sufficiently unrealistic to result in respondents discounting each profile s attractiveness thus reducing the validity of the results a related problem which adds to the complexity of new product pricing research is the bundling issue in the context of conjoint analysis the question is whether one can predict a respondent s evaluation of a bundle of product attributes and price as a simple linear function of the summed part worths of the entities making up the bundle when each entity is presented with its actual price metric hybrid conjoint models have received a fair amount of industry application to date the purpose of these models is to reduce data collection time while still retaining individual differences in part worth functions the present paper extends this class of models to include categorical conjoint analysis in which the criterion variable is classificatory this model is applied to an extremely large conjoint problem involving over 40 attributes and over 100 attribute levels the study results support the viability of the model for dealing with extremely large conjoint problems the study also shows evidence of the inability of simple functions of self explicated utilities for components of a bundle of hotel amenities to predict respondents preferences for the total bundle journal of business 1984 vol 57 no 1 pt 2 1984 by the university of chicago all rights reserved 0021 9398 84 5712 0019 0 1 50

add on pricing by asymmetric firms this paper uses an analytical model to examine the consequences of add on pricing when firms are both horizontally and vertically differentiated and there is a segment of boundedly rational consumers who are unaware of the add on fees at the time of initial purchase we find that consumers who know the add on fees can be penalized and increasingly so by the existence of boundedly rational consumers our consideration of quality asymmetries on base goods and add ons plus the inclusion of boundedly rational consumers leads to several novel findings regarding firm profits when quality asymmetry is on base goods only and with boundedly rational consumers add on pricing can diminish profit for a qualitatively superior firm and increase profit for an inferior firm i e a lose win result compared to when add on pricing is prohibited or infeasible when quality asymmetries exist on both base goods and add ons and without boundedly rational consumers the opposite win lose result prevails when quality asymmetries exist on both base goods and add ons and with boundedly rational consumers the result can be win win win lose or lose win depending on the magnitude of quality differentiation on add ons this paper was accepted by j miguel villas boas marketing

tourism demand for italy and the business cycle this study provides a strategy for modelling the effect of the business cycle on tourism demand under the rationale that tourism cycles are heavily influenced by lagged effects of the overall business cycle using quarterly data on overnight stays in italian hotels both domestic and inbound between 1985 and 2004 we adopt a structural time series approach to evaluate two alternative models the first with a latent cycle component lcc and the second based on specific economic explanatory variables xcv the two models are compared in terms of explanatory power best fit residual diagnostics and forecasting ability the results show similar performances the policy implication is that the xcv model can be used for calibrating countercyclical interventions in tourism policy

combining volatility and smoothing forecasts of uk demand for international tourism abstract univariate volatility models are applied to uk tourism demand to the country s most popular international destinations volatility is a concept borrowed from finance the fact that significant volatility models are found for ten of the twelve destinations examined shows that the volatility concept has relevance to tourism demand volatility models are able to quantify the impacts of positive and negative shocks on tourism demand the impacts of negative shocks vary in magnitude and duration according to the destination involved and the nature of the shock the forecasting capability of these models has never been assessed in the tourism field they are shown to generate highly accurate forecasts but become optimal when combined with forecasts obtained from exponential smoothing models two methods of combining individual forecasts are considered bias in individual volatility and smoothing models and in combinations of them is examined

how buyers perceive savings in a bundle price an examination of a bundle s transaction value although bundling the selling of two or more products and or services at a single price has a history of economic research marketing oriented investigations have appeared only recently this pap

the paretian liberal paradox and ecological economics abstract two of the most basic considerations in collective choice are the pareto principle and some minimal protection of individual rights in his impossibility theorem sen 1970 shows that there is a potential inconsistency between preference sovereignty as expressed by the pareto condition and the protection of minimal rights a liberal or liberty condition the paretian liberal paradox plp and the extensive debate surrounding it prompts serious reconsideration of the traditional welfare economics approach the critique of welfarism made by the plp is of central importance for environmental issues given pervasive externalities missing markets uncertainty and potential irreversibilities making collective choice decisions on these issues may require using explicit non utility information and restricting individual preference sovereignty we explore the implications of the plp for long term environmental policy and the transdisciplinary field of ecological economics as a simple pedagogical device relying on sparse principles the plp stimulates an increased awareness of the potential conflict between preferences and rights recognition of the plp focuses attention on what counts as admissible information in collective choice rules for example consideration of the plp illuminates differences in the informational requirements of alternative sustainability concepts

forecasting tourist arrivals using origin country macroeconomics this study utilizes both disaggregated data and macroeconomic indicators in order to examine the importance of the macroeconomic environment of origin countries for analysing destinations tourist arrivals in particular it is the first study to present strong empirical evidence that both of these features in tandem provide statistically significant information of tourist arrivals in greece the forecasting exercises presented in our analysis show that macroeconomic indicators conducive to better forecasts are mainly origin country specific thus highlighting the importance of considering the apparent sharp national contrasts among origin countries when investigating domestic tourist arrivals given the extent of the dependency of the greek economy on tourism income but also given the perishable nature of the tourist product itself results have important implications for policy makers in greece

freight charge variations in truck transport markets price discrimination or competitive pricing it is well known that truck freight rates for different commodities over a given route vary and that rates per unit distance for the same commodity over different routes vary in previous studies this variation has been attributed to noncompetitive behavior in this paper a hypothesis that observed variations in truck rates are consistent with competitive behavior is tested using conjoint analysis trade offs between costs or rates and other attributes of transport service are estimated from experiments using panels of truck brokers and carriers the results are consistent with competitive behavior in the trucking industry

a general choice model for bundles with multiple category products application to market segmentation and optimal pricing for bundles abstract the attribute based approach to study customer choices cannot deal with bundles of heterogeneous components which are usually drawn from different product categories the authors develop the comparability based balance model which is a unified framework for modeling bundle choices the model can be employed for any bundle regardless of the heterogeneity of bundle components under a pure bundling strategy the conjoint model and balance model are special cases of the general model the authors use mixture distributions in a hierarchical bayesian framework to incorporate consumer heterogeneity in a more flexible manner than the extant approaches such as latent class and random coefficient models the empirical tests of the model show that most attribute effects are significant and consistent with the model s predictions the model is superior to those that do not consider the issues of comparability of attributes latent class structure and heterogeneity among respondents the authors show how

comment on conjoint analysis of price premiums for hotel amenities firms are often faced with the problem of designing and pricing new products in durables such as houses cars and personal computers and also in services such as hotel accommodations there is a basic unit that the firm can offer at a base price in addition the firm can offer and the consumer may choose optional add ons at a premium the types of decisions to be made by a firm in this context are

commodity bundling by single product monopolies consider two products that have independent demands in the sense that all individual buyers consider them neither substitutes nor complements then if the two products are priced separately the demand for either is independent of the price of the other in his classic analysis of block booking of feature films george stigler shows that it may be profitable for a monopoly seller of two such products to bundle them by requiring a buyer to take both in order to get either his work provides a rationale for tying arrangements that does not depend on technological or other dependencies among the products involved 2 adams and yellen extend the analysis of multiproduct monopoly with independent demands 3 they discuss two different bundling strategies pure bundling in which the seller only offers the products in fixed proportions and mixed bundling in which buyers may either buy the products separately or purchase a bundle with fixed proportions of each in this note i consider a single product monopoly and investigate the profit and welfare implications of bundling its product for some other