Search

We study endogenous personalized pricing in Hotelling's model with vertically differentiated products, cost asymmetries and linear adjustment costs. We characterize the equilibrium and its welfare consequences. Adopting personalized pricing is the dominant strategy for both companies. The less efficient company never gains compared to competition in uniform pricing. We clarify the conditions under which the more efficient company can gain from competition in personalized pricing. Aggregate consumer surplus increases, but personalized pricing can harm consumers who purchase from the more-efficient (high-quality) firm.

This paper utilizes Bayesian (static) model averaging (BMA) and dynamic model averaging (DMA) incorporated into Markov-switching (MS) models to forecast business cycle turning points of the United States (US) with state-level climate risks data, proxied by temperature changes and their (realized) volatility. We find that forecasts obtained from the DMA combination scheme provide timely updates of US business cycles based on the information content of metrics of state-level climate risks, particularly the volatility of temperature, relative to the corresponding small-scale MS benchmarks that use national-level values of climate change-related predictors.

We estimate the relationship between firms’ production flexibility and profitability under extreme positive demand shocks using the European toilet paper manufacturing industry in 2020 as a case study. This industry faced extreme increases in demand due to consumers panic purchasing toilet paper after the outbreak of the COVID-19 pandemic. Our estimates show that flexibility and profitability are positively related. This is even more pronounced in times of an extreme positive demand shock when a ten percent improvement in flexibility is associated with a five percent increase in profitability.

The paper studies the selection into the widespread job retention support that was provided during the Covid-19 pandemic and the employment effects of it, using firm-level administrative data for Estonia that cover the whole population of firms in 2019-2020. The endogeneity of the support is addressed by creating a control group from firms that were as severely hit as those that received the support and by using matching techniques. It is found that there was no selection of firms into the support by productivity once the sample is restricted to firms that experienced similar adverse conditions. The support had a positive effect on employment, as about one job in five that was supported by the scheme was saved and the unemployment rate would have been 2-4 percentage points higher in 2020 without the support.

We study the asset-pricing implications of changes in the variety of consumption goods which happens through free entry and exit of firms. Fluctuations in varieties drive a wedge between the measured and model-based (including variety growth) consumer price index making the pricing kernel as well as asset prices more volatile without driving up the volatility of consumption growth. Different from earlier endowment economy models of variety growth our model contains production which (i) generates the correlations important for the explanation of the high mean and volatility of equity premium endogenously, and (ii) leads to an increase of about 140 basis points in the risk-premia relative to the endowment model.

This study investigates whether green supply chain management (GSCM) practices help companies to be resilient against the buffer effect in the context of COVID-19. Building on the instrumental version of stakeholder theory, companies implementing GSCM practices should build environmental skills and competitive advantage to cope with a crisis caused by supply chain disruptions. Our survival analysis, conducted on 5,696 firms headquartered in 35 countries, shows clear evidence that GSCM companies' market prices recover quickly from the shock. Considering mounting pressure on environmental issues, this study documents the new benefits of GSCM for companies confronted with a global financial shock. By applying a large sample, the study has originality and implications for stakeholders, including investors, governments, and policymakers, to push firms to become more eco-friendly and resilient.

Using Chinese data, this study examines the effect of COVID-19 pandemic on tendencies and characteristics of information disclosure. Results show that, due to uncertainty caused by the pandemic, it is difficult to make earnings forecasts. Further, during the pandemic, forecast precision and timeliness decrease. The results remain unchanged under difference-in-difference (DiD) estimation. The findings of this paper extend existing studies on the economic consequences of COVID-19 pandemic and the influencing factors of information disclosure, providing implications for corporate managers, investors, and regulators.

This study extends the earlier literature on changes in school enrollment in the wake of the COVID-19 pandemic by using data for the second COVID-19 school year (2021-2022) from the state of New York. Contrary to expectations that the resumption of fully-live instruction would reverse the first COVID-19 year's declines in public school enrollment, we find that enrollment continued to drop sharply in the second COVID-19 school year, when schools were entirely back to in-person learning. These declines in enrollment vary substantially by grade, race and poverty and are robust to controlling for other COVID-19 related factors. In addition, we find mixed results for the number of private school students but significant increases in home-schooled students in the two COVID-19 years. The findings have important educational and fiscal implications.

We propose a protocol for repeated bargaining where occasional periods of good outside opportunities yield improved outcomes but also higher breakout probabilities, yet there is a lot of risk sharing. Crucially, we only consider Markov perfect equilibria that have neither non payoff-relevant state variables that are costly to compute nor a contrived process of equilibrium selection.

We revisit conduct parameter estimation in homogeneous goods markets to resolve the conflict between Bresnahan (1982) and Perloff and Shen (2012) regarding the identification and the estimation of conduct parameters. We point out that Perloff and Shen's (2012) proof is incorrect and its simulation setting is invalid. Our simulation shows that estimation becomes accurate when demand shifters are properly added in supply estimation and sample sizes are increased, supporting Bresnahan (1982)., 6 pages with appendix