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In the context of the energy transition policy that came into force in Spain in 2019, it is necessary for households progressively to substitute dirty energy heating sources with clean ones. This means replacing energy heating carriers that use carbon energy sources with others that use electricity, that is the cleaner energy source, specifically in Spain where electricity mainly comes from renewable sources. This replacement must be based on the use of modern and efficient electric heating appliances. This can involve a substantial economic effort for certain households, that are already vulnerable. This paper proposes a multinomial model to determine which variables explain households’ energy heating sources use and applies this model to microdata, from the Spanish Household Budget Survey, for 2016-2019. Results show that it is likely that energy-poor households use gasoil or coal and electricity for heating. It is also more probable that households living in rural areas and older buildings use these sources. Households renting their dwelling and living in warm regions are more likely to use electricity, whereas those living in cold regions, urban areas, with woman heads are more likely to use gas. Households owning the dwelling, with older heads and residing in larger houses are more likely to use gasoil or solid fuels. From these results, implications are derived to inform public policy regarding just energy transition. [ABSTRACT FROM AUTHOR]

This study aims to analyse enterprises' performance in terms of the National Innovation System – NIS in three Africans countries: Egypt, Côte d'Ivoire and Cameroon. Drawing inspiration from the Schumpeterian approach of innovation and using the World Bank Enterprises Survey (WBES-2016) data, we estimated a multinomial logit model. The results show that innovation system's different spheres (academic, governmental, enterprise, societal and environmental) of the quintuple helix contribute more to improving the performance of technological innovation in Egypt than in other countries. In addition, the analyses enabled us to highlight the embryonic state of the NIS in Africa. Thus, underlying innovation policies have been proposed to improve enterprises' performance in terms of the NIS in the different countries studied. [ABSTRACT FROM AUTHOR]

This paper presents a profit optimization model for substitute products in a competitive, time-sensitive market with scarcity and shifting user preferences. The model maximizes profit, considering production costs and inventory maintenance. It uses a discrete choice model to represent demand, sensitivity to price, availability, and changing preferences. A two-phase PSO-type metaheuristic solution tackles the nonlinear, recursive model, efficiently managing inventories and evolving consumer preferences. The model integrates production decisions, inventories, and sales prices, considering scarcity conditions and user preferences. It uses a multinomial logit for the consumers' demand function with soft exogenous constraints, which influence utility and change consumption preferences and choices. This research offers a tool for companies to manage stock, production, and pricing in a context where goods are substitutes, providing a new perspective on business strategy. [ABSTRACT FROM AUTHOR]

Since the Global Financial Crisis in 2007, a domino of banking distress episodes took place around the world, both at individual and systemic level. The bailout cost of these banking crises was extreme, especially in USA and EU countries, which were mostly affected. In recent years, there are many empirical studies, which attempt to develop a new mechanism of Early Warnings. As a result, more integrated and accurate systems are developed. Concerning the selection of the appropriate method, multivariate logit analysis is arguably one of the most popular models for EWSs. An important methodological issue, regarding the application of binary logit models, is how to deal with the observations following the onset of a banking crisis. One can either treat years after crisis as tranquil periods or remove them from the sample. In this paper, a multinomial logit model is applied to include all the crisis observations in the sample, treating them as a different outcome. Subsequently, this paper compares the predictive ability of binomial and multinomial logit models as EWSs for systemic banking crises in Eurozone, and, contrary to previous results, multinomial logit model does not seem to perform well to signal systemic banking crises. [ABSTRACT FROM AUTHOR]

Risk Sensitivity and Firm Power: Price Competition with Mean2-Variance Profit Objective Under Multinomial Logit Demand Firms with varying degrees of risk sensitivity perceive the same stochastic profit prospect differently. It is important to understand the equilibrium pricing behaviors under risk aversion and their implications on firms' survival and market health. The authors identify a power index, which is the ratio of product attractiveness to risk sensitivity, and show that the set of profitable firms is power index ordered. Firms with a favorable power index value earn a positive profit in a price competition, and others are driven to zero profit. Interestingly, although high risk aversion handicaps a firm, this paper shows that moderate risk aversion may give a firm an advantage over an otherwise equivalent competitor that is less risk sensitive. The authors also establish that in an equilibrium with market entry and exit, the power index is generalized to the ratio of product attractiveness and an entry cost-adjusted risk sensitivity measure. This paper is the first in the literature to address a risk-sensitive price competition under the multinomial logit choice model, with each participating firm maximizing a risk-adjusted profit objective. We find that, at equilibrium, a subset of firms earns a positive profit, whereas others are driven to zero profit, contrasting with the risk-neutral equilibrium in which all firms earn a positive profit regardless of quality and cost. We identify a power index—the ratio of effective product attractiveness to risk sensitivity—and show that the set of profitable firms is power index ordered. Risk aversion drives firms toward a more aggressive equilibrium pricing strategy and intensifies competition. However, the relative profit impact across firms is not monotone; although high risk aversion handicaps a firm, moderate risk aversion may place a firm at an advantage over an otherwise equivalent competitor that is less risk sensitive, contrary to intuition. In an equilibrium with market entry cost, we show that the set of active firms at equilibrium follows a generalized power index order that depends on entry cost. Furthermore, although the power index is decreasing in risk aversion, the generalized power index may initially be increasing in risk aversion. Supplemental Material: The online appendix is available at https://doi.org/10.1287/opre.2023.2466. [ABSTRACT FROM AUTHOR]

Problem definition: We investigate the effects of waiting time, mainly due to production in a make-to-batch-order (MTBO) system, on consumer choice behavior, pricing, assortment, and model estimation. In an MTBO system, the seller/manufacturer first collects orders placed within a certain period of time into a batch and then starts the production process. After the production of all orders in a batch are complete, the products are then shipped and delivered to individual consumers. Because of batch production and shipping, the disutility of the waiting time exhibits negative externality. Methodology/results: We adopt the widely used multinomial logit (MNL) model as a starting point and incorporate the anticipated wait into consumers' decision making. The derived model, referred to as the MNL with wait model, is a solution of the rational expectation equilibrium and is capable of capturing the effects of negative externality induced by anticipated wait that may change the substitution patterns dramatically. We characterize the multiproduct price optimization problem under the MNL with wait model by establishing a one-to-one mapping between the price vector and the choice probability vector. We find that firms tend to charge higher prices for time-consuming items and charge lower prices for time-saving items compared with the optimal prices under the standard MNL model. In addition to price competition, we also study the Cournot-type competition, in which the decision is the choice probability for each firm and establish the existence of a Nash equilibrium. For assortment optimization, we identify mild conditions under which the optimality of revenue-ordered assortments still holds. However, the assortment problem under the MNL with wait model is generally NP-hard, so we develop approximation algorithms with performance guarantees and provide an easy-to-compute tight upper bound. Moreover, we develop an efficient maximum likelihood-based algorithm for model calibration and further conduct numerical studies to showcase the importance of incorporating disutility due to wait in estimation, pricing, and assortment planning problems. Managerial implications: The MNL with wait model can increase prediction accuracy for consumers' choice behavior especially when they are aware of the potential wait. Failure to take into account the effects of anticipated wait in firms' decision making may lead to substantial losses. Funding: The research of C. Ke is supported in part by the National Natural Science Foundation of China [Grant 72101113]. Supplemental Material: The online appendix is available at https://doi.org/10.1287/msom.2020.0346. [ABSTRACT FROM AUTHOR]

Over the last decades, consumer has evolved becoming increasingly responsible, showing a preference for those foods having a positive impact on health, society and environment. In particular, consumers are showing an increasing interest in food innovation and towards foods capable to produce health benefits, such as enriched foods, which can be considered as functional foods. As consumer acceptance is crucial to the success of food innovation, this study aims to investigate consumers’ acceptance for two innovative enriched foods: extra virgin olive oil enriched with longchain Omega-3 fatty acids (EPA and DHA), and a lutein-enriched durum wheat pasta. To achieve study's aim, a choice experiment has been realized, also to detect consumers’ WTP. The analysis involved 445 Italian consumers. Results show that price represents the attribute that most of all is able to affect consumers’ utility, followed by the presence of the functional element. Furthermore, the analysis also shows consumers’ WTP a price premium for the functional attribute, for both products considered in the study. Such results highlight useful insights for practitioners and outlines new perspectives for future research.

AbstractCage fish farming is essential to increasing fish output, alleviating the declining capture fishery resources, and advancing aquaculture development in Uganda. There are limited studies assessing farmers’ knowledge, attitude, and perceptions towards cage fish farming technology. This study assessed the knowledge, attitude, and perceptions (KAP) of fishery-dependent communities around Lake Victoria towards cage fish farming technology. Using a simple random sample approach, 384 respondents from fourteen districts provided information on demographic traits, knowledge, attitudes, and perceptions towards cage fish farming. The analysis utilized descriptive statistics and a multinomial logit model. Results revealed that cage fish farmers’ knowledge, attitude, and perceptions were significantly associated with age, level of education, extension visits, social capital, experience, and television access. In conclusion, this study recommends that extension visits be enhanced to develop farmers’ knowledge, attitudes, and perceptions towards cage fish farming. The study’s implications underscore the importance of developing and implementing farmer-centered policies in the aquaculture sector.

Purpose: This article tests the corporate life cycle theory in the context of an emerging market. Design/Methodology/ Approach: We use 3179 non-financial Indian firms’ data for the period 2011-2020 to validate the claim. To access the robustness of empirical relationships, we employ multinomial logistic and probit regression models. Findings: The findings indicate that firms’ age follow a nonlinear pattern over its life cycle. Firms at the birth and decline stages experienced lower profitability, higher investment opportunities and less likelihood for dividends. Growth firms experiences higher investment opportunities, therefore raising more funds from debt along with paying dividends for reputation building. Furthermore, mature firms with larger size and shrinking investment opportunities, generating cash flows due to higher profitability. Thus, they pay dividend and consider being less risky. For 5 years of out-of-sample data (2016-2020), our model predicts with an average accuracy of 65%. From the perspective of inter-stage transition, firms in the birth and decline stages have a tendency to improve their position, whereas firms in the mature stages are relatively stable in future period. Originality: It seems that very few studies have examined the issue of how the firm characteristics varies over its lifecycle in emerging markets and our research bridges this gap in the literature. [ABSTRACT FROM AUTHOR]

This study delves into market participation and marketing channel preferences among smallholder Macadamia farmers in Embu West Sub County, Kenya. Employing a stratified multistage sampling procedure and multinomial logit regression analysis, the research reveals that despite offering lower prices, brokers remain the favored marketing channel. Several factors, including age, farming experience, consideration of macadamia quality, information flow, farm size, distance to market, payment period, and education level, significantly influence farmers' channel choice. The findings underscore the importance of policy interventions emphasizing non-price incentives, such as enhanced extension services and dissemination of macadamia marketing information, to encourage participation in more lucrative markets. [ABSTRACT FROM AUTHOR]

As a sustainable mode of travel, carpooling is an effective solution to environmental and energy problems, but it has not been fully utilized. The research on carpooling attitudes, especially for college students, still needs to be improved. In response to this problem, this paper aims to investigate the effect of personal attributes, travel attributes, attitude attributes and other attributes of students on carpooling attitudes in China. To collect the data, an online questionnaire survey was implemented at Shenzhen University, and 514 students participated. Based on the samples, the multinomial logit model is used to explore the contribution of all variables. The model results showed that personal attributes such as sex and age had no significant effect on the attitude of college students towards carpooling. The safety of carpooling and its high cost make college students have a neutral attitude towards it. The most concerning factor for college students in carpooling is comfort. These findings can provide valuable suggestions for measures to be taken in response to different attributes affecting students' attitudes and are particularly important for the university and government to make optimal decisions to motivate students to select carpooling. [ABSTRACT FROM AUTHOR]

There are few challenges greater than the puzzle of how to move perishable goods from smallholders' fields to final consumers, particularly where transportation barriers abound. Industrial processing can relax the perishability constraint and improve smallholders' options. In Iringa, Tanzania, multiple tomato processing establishments and traditional marketing agents are available for farmers to use. Information about the channels is expected to be vital for producers to choose optimally. In this study, we collected field data from 286 smallholder farmers and analyzed their market channel choice using the random utility model implemented with multinomial logit regression. Revenue performance was further evaluated. Our results confirm that access to market information and extension services were associated with higher farm revenue. Women farmers had more concerns than men about lacking information. Market participation differed by size of the business. Farmers with higher harvested quantity were more likely to choose industrial processing. Producers with small farms preferred full marketing service and mid-size farms chose wholesale markets. Agribusiness management scholars may follow similar research design with future attention paid to elicitation of producers' information about the marketing channels. [ABSTRACT FROM AUTHOR]

We study the problem of optimizing assortment decisions in the presence of product-specific costs when customers choose according to a multinomial logit model. This problem is NP-hard, and approximate solutions methods have been proposed in the literature to obtain both lower and upper bounds in a tractable manner. We propose the first exact solution method for this problem and show that provably optimal assortments of instances with up to 1,000 products can be found, on average, in about 2/10 of a second. In particular, we propose a bounding procedure to enhance an approximation method originally proposed by Feldman and Topaloglu and provide tight lower and upper bounds at a fraction of a second. We show how these bounds can be used to effectively identify an optimal assortment. We also describe how to adapt our approach to handle cardinality or space/resource capacity constraints on the assortment as well as assortment optimization under a mixed-multinomial logit model. In both cases, our solution method provides significant computational boosts compared with exact methods from the literature. [ABSTRACT FROM AUTHOR]

The present study examines the impact of family ownership and control on the internationalization strategies of Portuguese manufacturing firms. The study contributes to the existing literature by providing evidence that different forms of international market presence are asymmetrically influenced by family control and by underscoring the importance of innovative strategies. The analysis includes a sample of 25,533 firms observed from 2018 to 2021. Econometric models address the role of ownership in alternative internationalization endeavors, demonstrating that these firms differ from their non-family counterparts. By comparing the export propensity, intensity, and reach of family businesses to non-family businesses, the research sheds light on the challenges faced by family-owned firms and the significance of structural characteristics such as technological regimes and regional competitive advantages. The findings emphasize the negative impact of family presence on internationalization while highlighting the importance of innovation and ecosystem support. Additionally, the study contributes to the empirical refinement of firm classification by proposing a more reliable segmentation method. It also presents alternative econometric methods to appraise internationalization strategies better. Future research directions are suggested, particularly regarding the use of additional information related to innovation and human capital, offering insights for enhancing the global engagement of family businesses in global markets. This research provides valuable empirical evidence and practical implications for policymakers and practitioners seeking to support the required actions to promote the growth and internationalization of family businesses in the context of the Portuguese manufacturing industry. [ABSTRACT FROM AUTHOR]

Resource depletion, social inequality, and climate change are key among the global issues affecting the modern corporate world. Corporate sustainability is a major agenda at corporate boards. Stakeholders are increasingly demanding corporate responsibility in the wake of global resource depletion. Sustainability reporting has been experienced differently in different regions, with emerging economies being adversely stuck. Combating the bearing effects has been difficult due to a lack of synergy among the nations as well as a lack of harmonized corporate disclosure. Understanding the global socioeconomic and environmental concerns requires a close examination of the major determinants of sustainability reporting. Grounded on the agency, stakeholders, and legitimacy theory, this study aims to evaluate the influence of board attributes on sustainability reporting. Using a multinomial logistic regression model, the study assessed 110 nonfinancial firms listed in 10 Sub-Saharan African (SSA) countries from 2016 to 2021. The study analyzed the influence of board attributes on sustainability reporting. The result indicates that board size, board meetings, board independence, and board gender diversity have a positive influence on sustainability reporting. The finding provides policy implications and insight into the need for more representative boards with increased gender diversity and independence. Additionally, an optimal frequency of board meetings is needed to strengthen oversight, efficacy, and transparency of sustainability reporting initiatives in SSA. Larger representative board sizes could be rewarded with tax concessions.

Abstract The goal of this research is assess the variation in livelihood choices of households in Vietnam rural areas under the effects of climate change. Sustainable livelihood analysis framework and previous studies show that climate change has positive significant impacts on household livelihood transitions. Base on secondary dataset (Vietnam Access to Resources Household Survey) from 2008 to 2018 and applying multinomial logit model, the authors have indicated that climate change not only directly affects livelihood choices of inhabitans in rural areas but also indirectly influcences them through livelihood capitals, including: human capital, natural capital, material capital, financial capital, and social capital. In addion, authors have shown that the wage-based and nonagricultural strategy preferred under the effects of climate change. This study has also determined the effects of climate change on rural households via livelihood capitals, particularly human and social capital. Finally, the authors suggested some policy implications about quickly policy implement from government, enhancing social capital as well as social networks of households, improving human capital for climate change adaptation.

Introduction The aim of this study is to identify profiles of never smokers, exsmokers, occasional smokers, and daily smokers, through their individual, lifestyle, and health characteristics. This analysis allows provides profiles of individuals with a greater or less propensity to use tobacco, which contributes to the design of effective prevention policies. Methods Econometric models are used with data from the Spanish National Health Survey. Specifically, a multinomial logit model is estimated to evaluate the probabilities of tobacco use. Additionally, discrete changes, odds ratios, and predicted probabilities for prone individuals, are calculated. Results Differences are found between the profiles of each alternative of tobacco use. The individual attributes with the most striking effect are being aged 26–45 years, which reduces the probability of being a non-smoker by 21 percentage points compared to the younger group, and regular exposure to secondhand smoke, which is 30% more likely to be a regular smoker. The characteristics that define an individual with higher probability of smoking daily are: belonging to a certain region of Spain, male, aged 26–45 years, born in Spain, unemployed, with primary studies, separated, no physical activity, consumes alcohol, and is exposed to smoke regularly, not chronically ill, and have very poor health. Conclusions Identification of the profiles most likely to choose each of the tobacco consumption alternatives can contribute to the design of more effective prevention strategies. The results confirm that the accumulation of bad habits results in a high risk of smoking. The quantification of the differences in the effects of each trait is an interesting contribution that is useful to orient the policies to specific segments of the population more prone to consume tobacco.

This study examines the factors influencing women farmers’ choice of adaptation strategies to reduce the negative impacts of climate change and the effects of these strategies on household income and food insecurity. A field survey was conducted among 426 women farmers in the Center-North region, which covers 7% of Burkina Faso territory. Descriptive statistics, a multinomial logit model, and a propensity score matching model were used to analyze the data collected. The results of the econometric analysis show that high domestic tasks, type of climate shocks experienced, membership in women’s group, and financial constraints are important determinants of adaptation decisions. Adaptation strategies are also found to have a positive impact on income and a negative impact on household food insecurity. These different findings highlight the need to prioritize flexible adaptation options to improve women farmers’ resilience to climate change, rather than generic solutions.

The goal of this research is assess the variation in livelihood choices of households in Vietnam rural areas under the effects of climate change. Sustainable livelihood analysis framework and previous studies show that climate change has positive significant impacts on household livelihood transitions. Base on secondary dataset (Vietnam Access to Resources Household Survey) from 2008 to 2018 and applying multinomial logit model, the authors have indicated that climate change not only directly affects livelihood choices of inhabitans in rural areas but also indirectly influcences them through livelihood capitals, including: human capital, natural capital, material capital, financial capital, and social capital. In addion, authors have shown that the wage-based and nonagricultural strategy preferred under the effects of climate change. This study has also determined the effects of climate change on rural households via livelihood capitals, particularly human and social capital. Finally, the authors suggested some policy implications about quickly policy implement from government, enhancing social capital as well as social networks of households, improving human capital for climate change adaptation. [ABSTRACT FROM AUTHOR]

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INTRODUCTION The aim of this study is to identify profiles of never smokers, ex-smokers, occasional smokers, and daily smokers, through their individual, lifestyle, and health characteristics. This analysis allows provides profiles of individuals with a greater or less propensity to use tobacco, which contributes to the design of effective prevention policies. METHODS Econometric models are used with data from the Spanish National Health Survey. Specifically, a multinomial logit model is estimated to evaluate the probabilities of tobacco use. Additionally, discrete changes, odds ratios, and predicted probabilities for prone individuals, are calculated. RESULTS Differences are found between the profiles of each alternative of tobacco use. The individual attributes with the most striking effect are being aged 26-45 years, which reduces the probability of being a non-smoker by 21 percentage points compared to the younger group, and regular exposure to secondhand smoke, which is 30% more likely to be a regular smoker. The characteristics that define an individual with higher probability of smoking daily are: belonging to a certain region of Spain, male, aged 26-45 years, born in Spain, unemployed, with primary studies, separated, no physical activity, consumes alcohol, and is exposed to smoke regularly, not chronically ill, and have very poor health. CONCLUSIONS Identification of the profiles most likely to choose each of the tobacco consumption alternatives can contribute to the design of more effective prevention strategies. The results confirm that the accumulation of bad habits results in a high risk of smoking. The quantification of the differences in the effects of each trait is an interesting contribution that is useful to orient the policies to specific segments of the population more prone to consume tobacco. [ABSTRACT FROM AUTHOR]

Airport public transport systems are plagued by passenger queue congestion, imposing a substandard travel experience and unexpected delays. To address this issue, this paper proposes a bi-level programming for optimizing queueing network in airport access. Firstly, we derive queueing network for airport public transport system, which include the taxi, bus, and subway. Then, we propose a bi-level programming model for optimizing queueing network. The lower level subprogram is designed to solve the passenger transport mode choice, while the upper level subprogram is designed to minimize the number of passengers waiting to be served with queue tolls. Finally, we develop the successive weighted averages (MSWA) method to solve the lower subprogram's passenger share rates and the ant lion optimization (ALO) method to solve the bi-level program's queue toll scheme. The simulation results highlight that our strategy can alleviate queue congestion for daytime and evening scenarios and effectively improve evacuation efficiency. [ABSTRACT FROM AUTHOR]

Assortment planning is a challenge for retailers because most current solutions only consider revenue maximization and ignore the trade-offs between revenue and market share. To address this challenge, we develop a bi-objective capacitated assortment planning (B-CAP) problem based on the multinomial logit (MNL) choice model and reveal managerial insights into the bi-objective function of the B-CAP problem. To solve this problem, we first examine the performance guarantees of the revenue-ordered assortment. Then, we provide parametric linear programming to generate candidate assortments and analyze the unimodality of the bi-objective function to simplify the computational complexity. Hence, the two-stage approach consisting of the geometric algorithm and Fibonacci search is designed to obtain the optimal solution. Finally, we present numerical experiments on both simulated and real data. The results indicate that the two-stage approach performs well in solving the B-CAP problem. Besides, an interesting finding is that market share may be significantly increased without a huge loss in total revenue when the trade-off parameter is small. [ABSTRACT FROM AUTHOR]

Amman, the capital of Jordan, has experienced significant traffic congestion due to the rise in private vehicle ownership and limited public transportation services. A Stated Preference (SP) survey was conducted to determine public transportation users' willingness to use the Bus Rapid Transit (BRT) service. Another survey assessed the demand for an on-demand transit bus service with flexible and moderate costs, particularly for individuals far from the main BRT stations who need to reach them. Two models, Multinomial Logit (MNL) and Mixed Logit (ML), were utilized to understand user preferences for work-related trips. The study findings indicate that the cost of the trip and the waiting time are the two primary factors influencing public transport users' choices. Furthermore, sociodemographic factors, such as age, income, household size, and current status, were found to have a significant impact. The results reveal that approximately 71% of participants would utilize an integrated public transportation system comprising BRT and on-demand services. The findings underscore the potential benefits of an integrated public transport system in addressing Amman's traffic congestion. By combining BRT and on-demand services, the city can offer residents comfortable, affordable, and efficient transportation options, thus effectively mitigating congestion. [ABSTRACT FROM AUTHOR]

Similar to individual investors, firms balance revenue or profit risk with the expected return on investment. A stable cash flow is required to satisfy private and public shareholders or to maintain solvency. Product prices impact both the expected demand for the products and the volatility of the demand, and consequently a firm's revenue or profit risk. This paper presents models and results that demonstrate how risk sensitivity can inform pricing strategy. The authors show that a firm's distaste for risk not only causes the firm to discount its products in exchange for lower profit volatility, but also reduces the firm's incentive to price differentiate among the products. The findings also provide insight into how firms with varying degrees of risk aversion may price products of different quality and how this pricing strategy affects product market share. We examine a firm's pricing decision when managing a broad product line with the goal of optimally balancing the expected return on product investment with the revenue or profit risk associated with uncertain customer choices. We consider the multinomial logit (MNL) model and the mean-variance objective function and illustrate how the level of risk tolerance influences the firm's optimal markups. We show that the solution approach and results generalize to the nested logit (NL) choice model and alternative risk-adjusted objectives. This paper is the first in the literature addressing risk-sensitive pricing under discrete choice models. Our analysis presents how the firm's optimal pricing decision evolves with increasing risk sensitivity. The optimal risk-balancing solution stands in contrast to the profit-maximizing solution: for example, (i) the firm's distaste for risk not only causes the firm to discount its products in exchange for lower profit volatility but also reduces the firm's incentive to price differentiate among the products; (ii) although risk drives the firm to attain a higher total market share through lower prices at the cost of lower profit, certain products may gain, whereas others may lose in market share; and (iii) the optimal risk-balancing markups follow the sequence of product quality, whereas the optimal adjusted markups (i.e., markups adjusted for product-specific price sensitivity) follow the reverse sequence of quality. Supplemental Material: The online appendices are available at https://doi.org/10.1287/opre.2023.2465. [ABSTRACT FROM AUTHOR]

This study examines the contribution of eucalyptus tree expansion on rural households' food security status, focusing on the specific context of Ethiopia. Eucalyptus trees pose a significant challenge to the rural food system, warranting investigation. A composite food security indicator was used, and data were collected through household surveys, Focus Group Discussions (FGDs), and Key Informant Interviews (KIIs). Descriptive analysis and multinomial logistic regression models were employed for data analysis. The findings reveal that among the sampled households, 31.2% were classified as food secured, 24.8% as intermediate food secured, and 44.0% as food insecured. Econometric estimations highlight the positive influence of variables such as total land holding and livestock on the likelihood of being in the food secured category. Moreover, a unit increase in income earned from the sale of eucalyptus trees leads to an 8.5% higher probability of being in the intermediate category, while decreasing the likelihood of falling into the categories of food insecurity by 8.1% and food security by 0.4%. Importantly, this study uncovers the diverse consequences of eucalyptus trees across different food security categories, suggesting that the planting of eucalyptus trees for improving rural livelihoods and food security must be tailored to specific household conditions. The research outcomes provide valuable insights for guiding future policies, practices, and research endeavors aimed at achieving a sustainable food system in rural Ethiopia.

Logistic regression has long been the gold standard for choice modeling in the transportation field. Despite the rising popularity of machine learning (ML), few is applied to predicting the household vehicle transactions. To address the research gap, this paper presents a first use case of ML application to predicting household vehicle transaction decisions by leveraging a newly processed national panel data set. Model performances are reported for four ML models and the traditional multinomial logit model (MNL). Instead of treating the gold standard and ML models as competitors, this paper tries to use ML tools to inform the MNL model building process. We find the two gradient boosting based methods, CatBoost and LightGBM, are the best performing ML models; and improving logistic models with SHAP interpretation tools can achieve similar performance levels to the best performing ML methods.

This paper presents a profit optimization model for substitute products in a competitive, time-sensitive market with scarcity and shifting user preferences. The model maximizes profit, considering production costs and inventory maintenance. It uses a discrete choice model to represent demand, sensitivity to price, availability, and changing preferences. A two-phase PSO-type metaheuristic solution tackles the nonlinear, recursive model, efficiently managing inventories and evolving consumer preferences. The model integrates production decisions, inventories, and sales prices, considering scarcity conditions and user preferences. It uses a multinomial logit for the consumers’ demand function with soft exogenous constraints, which influence utility and change consumption preferences and choices. This research offers a tool for companies to manage stock, production, and pricing in a context where goods are substitutes, providing a new perspective on business strategy.

Credit accessibility is crucial for sustainable agricultural development. However, the difficulty in accessing credit has caused farmers to take many considerations when taking a loan. This research aims to determine the factors determining access and credit sources for cassava farmers in Lampung Province, Indonesia. Central Lampung was chosen as the research location because it had a total cassava production share of 36%. This study used Isaac’s and Michael’s formulae to determine the total samples. The data were collected by interviewing 263 respondents. Of 263 farmers, only 109 (41.4%) had access to loans. Data were analysed using the Multinomial Logit Regression Model to examine the factors determining access and credit sources for cassava farmers. Marginal effect analysis was also used to determine the probability of changes in independent variables. Regression results showed that the type of credit sources chosen by the farmers was determined by age, income, agribusiness experience, land size, education, organisation membership, and credit experience (R 2 = 89.1%). Partially, age, income, land size, education, credit experience, and business experience significantly influence the funding source. The results indicate that age, agribusiness experience, and land size are the main factors in choosing the types of credit. Land size has the biggest positive influence on farmers’ access to formal banks (11.49%).

AbstractProtected vegetable farming has emerged as a potential approach to improve the yield and quality of produce around the globe. In Nepal, it has a short history since 1996, but over the past decade, investment in protected structures has been gaining momentum. This paper discusses the findings of the study in the area of profitability and the determinants of protected vegetable farming in Nepal. The study was conducted in seven districts of Nepal by selecting 90 respondents growing vegetables under protected structures. Descriptive statistics and multinomial logistic regression were used to analyze data. The financial analysis showed a significantly higher benefit–cost ratio and payback period in temporary structures than those in semi-permanent and permanent structures. The productivity of vegetables under different types of protected structures was statistically similar to average productivity of 191.55 mt./ha/year. The multinomial logistic regression studied among 15 explanatory variables found 10 explanatory variables to be significant whether at 1% or 5% or 10% probability level. The variables, namely, gender, education, family type, household members involved in agriculture, experience in vegetable farming and subsidies received, were found to have a significant and positive influence on the adoption of semi-permanent and permanent structures, whereas the variables, namely, age, membership in farmers group, record keeping and technician visit, were found to have a significant and negative influence. The findings of the study would have implications for the policymakers, suppliers of the structure installment materials and farmers regarding the promotion and adoption of different types of protected structures.

The fishing industry is a crucial means of reducing poverty and providing jobs for people living in coastal communities, but historically, there have been barriers to accessing markets. This study uses a cross-sectional survey to examine the factors that influence multiple sources of income, market involvement, and the level of market involvement for fishers in the Dawhenya reservoir, Ghana. Most households engaged in fishing only and were net sellers. The level of market involvement for net sellers or buyers is affected by declining fish catches and lack of inputs, while the intensity of market involvement is influenced by factors such as age, the number of dependents, access to infrastructure, limitations on inputs, availability of credit, and declining catches. [ABSTRACT FROM AUTHOR]

We study the assortment optimization problem in an online setting where a retailer uses multiple distribution centers (DC) to fulfill orders from multiple regions. Customer choice in each region follows a multinomial logit model. Each DC can carry up to a pre‐specified number of products. Outbound shipping cost to a region depends on the DC that ships the order. The problem is to determine which products to carry in each DC and which products to offer for sale in each region to maximize the expected profit. We first show that the problem is NP‐complete. We develop a conic quadratic mixed integer programming formulation and suggest a family of valid inequalities. We also show that a special case with identical choice models can be solved as a linear program. This LP solution approach can be used to develop heuristics for the general case. Numerical experiments show that our conic approach outperforms the mixed integer linear programming formulation and enables us to solve moderately sized instances optimally. The experiments also show that not allowing cross‐shipments or not considering them in assortment decisions may lead to substantial losses and LP‐based heuristics can be effective in practice. [ABSTRACT FROM AUTHOR]

Decades ago, bicycles used to play an important role in urban transportation in Chinese cities, but they have been gradually replaced by private cars, metro, buses, and some other modes, owning to the fast-growing mobility demand as a result of urban expansion and motorization. However, in recent years, with the development of Information and Communication Technologies (ICT) and the initiative of the sharing economy, bike-sharing systems (BSSs) have been implemented extensively in Chinese cities. Their usage patterns can be revealed via system-generated data, yet less is known about users' attitudes towards and preferences for these systems. In this study, we draw on two surveys conducted in Guangzhou and Beijing on the perceptions of travelers using BSSs to estimate the effect of demographic factors, bicycle ownership, and trip-level factors on the willingness and potential frequency of BSS usage. In addition, a latent class model is built to analyze the different aspects of theses systems concerned with different types of urban travelers. It is found that respondents' age, occupation, income, mode combination, and the proximity of origin or destination to the docking station, etc., influence the willingness and frequency of using BSSs. In addition, respondents generally value features such as the proximity of docking stations to trip destinations, safety to ride, and appropriate level of fare. However, different latent classes show a different preference for other features of BSSs. According to the model results, proposals are given for the improvement of the existing systems in Chinese cities. [ABSTRACT FROM AUTHOR]

Market segmentation using consumer preferences is important for the marketing strategy. For staple foods, like olive oil in the Mediterranean region, intrinsic attributes of the product lead these preferences and should prevail in determining consumer groups. In this paper, we apply conjoint analysis and clustering methods to identify olive oil consumer segments in the Tunisian market. A survey was carried out among 274 consumers who were required to blind taste of samples and give scores for 12 different samples of Tunisian Extra Virgin Olive Oil (EVOO). Results revealed three differentiated segments of consumers; 43.8% of consumers prefer strongly flavored olive oil with deep green color while 38.9% support light yellow olive oil with lower flavor. These preferences are described by age, income category, and consumption frequency. Our results indicate that in countries where olive oil is a traditional food ingredient, the marketing strategy must focus on the product's intrinsic attributes to better target customers. [ABSTRACT FROM AUTHOR]

Empirical demand functions, such as those from choice-based conjoint analyses, are critical to many aspects of marketing. Approaches have been developed to ensure that research subjects provide honest and thoughtful responses. However, to reduce costs, researchers increasingly collect data online, under conditions that compromise the value of the information provided. Objective measures related to how the study is completed, such as latency (how quickly answers are given), can only be tied to other objective measures (such as the consistency of the answers), but ultimately their relationship to the subject's utility function is questionable. To address this problem, the authors introduce a mixture modeling framework that clusters subjects based on variances. The proposed model naturally groups subjects based on their internal consistency. The authors argue that a higher level of internal consistency (i.e., lower variance) reflects more engaged consumers who have sufficient experience with the product category and choice task. "Gremlins," in contrast, behave such that the noise in their responses overwhelms any signal, leading to a lack of predictive power. This approach provides an automated way to determine which respondents are relevant. The authors discuss the conceptual and modeling framework and illustrate the method using both simulated and commercial data. [ABSTRACT FROM AUTHOR]

The present study examines the impact of family ownership and control on the internationalization strategies of Portuguese manufacturing firms. The study contributes to the existing literature by providing evidence that different forms of international market presence are asymmetrically influenced by family control and by underscoring the importance of innovative strategies. The analysis includes a sample of 25,533 firms observed from 2018 to 2021. Econometric models address the role of ownership in alternative internationalization endeavors, demonstrating that these firms differ from their non-family counterparts. By comparing the export propensity, intensity, and reach of family businesses to non-family businesses, the research sheds light on the challenges faced by family-owned firms and the significance of structural characteristics such as technological regimes and regional competitive advantages. The findings emphasize the negative impact of family presence on internationalization while highlighting the importance of innovation and ecosystem support. Additionally, the study contributes to the empirical refinement of firm classification by proposing a more reliable segmentation method. It also presents alternative econometric methods to appraise internationalization strategies better. Future research directions are suggested, particularly regarding the use of additional information related to innovation and human capital, offering insights for enhancing the global engagement of family businesses in global markets. This research provides valuable empirical evidence and practical implications for policymakers and practitioners seeking to support the required actions to promote the growth and internationalization of family businesses in the context of the Portuguese manufacturing industry.

In this research note, we study the welfare implications of shortening the length of the lock-in period associated with triple play contracts using household level data, from a large telecommunications provider, for a period of 6 months. Using a multinomial logit model to explain consumer behavior we show that, in our setting, shortening the length of the lock-in period decreases the aggregated profit of the firms in the market more than it increases consumer surplus. This result arises because shortening the length of the lock-in period increases churn, and the costs to set up service for the consumers that churn and join a new carrier supersede the increase in the consumers’ willingness to pay for service when the length of the lock-in period shortens. [ABSTRACT FROM AUTHOR]

The study analysed the extent of vulnerability to food insecurity and household coping mechanisms among yam farmers in Ekiti State, Nigeria. Cross-sectional data were used for this study with the aid of a well-designed questionnaire. A multistage sampling procedure was used to select 360 respondents. Multinomial logit (MNL) model and Feasible Generalized Least Square (FGLS) method were employed for the data analysis. The results of the FGLS model showed that 49.3% of the households were food secure and experienced low vulnerability to food insecurity. However, 30.23% of them were food insecure and highly vulnerable; they are considered as chronically food-insecure households. Also, the study revealed that 11.01% of the food secure households may be food insecure in the future if necessary attention and intervention are not given by both households and the government. Again, 9.4% of the households that were experiencing food shortage, as at the time of the study, may recover in the future. The findings of MNL revealed that the age of the household head, main occupation, household size, land size, net household income, and membership in a cooperative society were the main significant factors in yam farming households' decision to use coping strategies. As a result, it is recommended that leveraging the potential role of coping mechanisms already used by households during food shortages, and building a comprehensive human capital development, such as education, will be vital policy options to reduce food insecurity.