Thesis (Ph. D.)--Ohio State University, 2006. / Title from first page of PDF file. Includes bibliographical references (p. 90-97).

This thesis presents four largely independent essays on industrial organisation. The first three essays examine how search and switching costs distort competitive markets, whilst the fourth essay studies how firms themselves might eliminate competition by agreeing to fix the market price. The key insight from the first two essays is that by choosing to pay a search cost, a consumer reveals to a retailer some private information about their product valuations. In this context the first essay re-examines the well-known theoretical Diamond Paradox in which markets completely break down if firms sell only a single product. I demonstrate that multiproduct retailers offer an elegant and realistic way of overcoming this Paradox, and then apply the model to supermarkets. In particular, this essay provides new insights into why convenience stores charge high prices and why grocery stores use selected loss-leaders. The second essay looks at internet search and therefore focuses on the special case in which search frictions become very small. It seeks to explain why retailers pay so much for online advertising, when consumers can easily click on whichever links they like. I show that if consumers have prior information about products, their search behaviour is limited but very informative about their preferences. This places prominent firms in a privileged position, and makes them substantially more profitable. The third essay provides a simple model in which small switching costs are pro-competitive and beneficial to consumers. This challenges the conventional wisdom, but also argues that switching costs should be less of a policy priority than search costs. The final essay examines a game in which two firms bargain over a collusive price. It is shown that entry into such a market may make collusion easier, and may increase price.

The three chapters of my dissertation study imperfect competition, multiproduct firms, and consumer demand. Chapter 1 estimates a structural model of consumer demand and oligopolistic retail competition in order to study three mechanisms through which retailers affect allocative efficiency and consumer welfare. First, variable markups across retail stores within a location induce a misallocation of resources. The deadweight loss from this retail misallocation can be large since a significant fraction of household consumption comes from retail goods. Second, across locations, retail markups may vary with market size. This regional variation plays an important role in recent economic geography models as an agglomeration force. In the limit, models predict that the distortion from variable markups disappears in large markets, although it is an open question, How Large is Large? Third, since retail stores are differentiated, differences in the variety of retail stores available to consumers matters for consumer welfare across locations. To quantify the importance of these mechanisms, I estimate my model using retail scanner data with prices and sales at the barcode level from thousands of stores across the US. I find that the deadweight loss and consumption misallocation from variable retail markups are economically significant. I estimate that retail markups are smaller in larger cities, and that markets the size of New York City and Los Angeles are approximately at the undistorted monopolistically competitive limit. My results show that retail store variety significantly impacts the cost of living and could be an important consumption-based agglomeration force. The second chapter of my dissertation develops and structurally estimates a model of heterogeneous multiproduct firms that can be used to decompose the firm-size distribution into the contributions of costs, quality, markups, and product scope. In this joint work with Stephen J. Redding and David E. Weinstein, we find that variation in firm quality and product scope explains at least four fifths of the variation in firm sales using Nielsen barcode data on prices and sales. We show that the imperfect substitutability of products within firms, and the fact that larger firms supply more products than smaller firms, implies that standard productivity measures are not independent of demand system assumptions and probably dramatically understate the relative productivity of the largest firms. Although most firms are well approximated by the monopolistic competition benchmark of constant markups, we find that the largest firms that account for most of aggregate sales depart substantially from this benchmark, and exhibit both variable markups and substantial cannibalization effects. The final chapter of my dissertation develops a new integrable demand system, called the Doubly-Translated CDES demand system, which is well suited to theoretical and empirical work. Commonly used analytically and computationally tractable demand systems severely restrict key properties of demand, which parametrically pins down the answers to many important economic questions. The Doubly-Translated CDES demand system is flexible in important ways that common demand systems are not, while maintaining effective global regularity and global consistency. Using data, I provide examples of this demand system's flexibility by calibrating different parameter values. I discuss how this demand system can be estimated with regularity imposed and correcting for the endogeneity of prices using constrained Nonlinear GMM.

Thesis (Ph.D.)--University of Nebraska-Lincoln, 2006. / Title from title screen (site viewed May 9, 2007). PDF text: vi, 70 p. ; 0.69Mb UMI publication number: AAT 3237386. Includes bibliographical references. Also available in microfilm and microfiche formats.

Budgetary restraints have forced a re-evaluation of expenditures for health care. regardless of the methods of delivery and financing. Efficiency in resource allocation implies production of an optimal output mix at minimum opportunity cost. Inefficiencies in resource allocation will result in higher costs. It is often argued that the fee-for-service reimbursement method, in particular, provides incentives for over-servicing, with elective surgery receiving most attention since international and intranational variations were out of line with variations in morbidity. Although the initial concern of physicians was with the clinical risks of unnecessary surgery. concern with the rising costs of providing health care has turned attention to financial factors as possible explanations of the variations in elective surgical procedures. The physician plays a key role in the allocation of resources in the health care sector. It is, therefore, likely that the aggregate output mix of different services will be responsive to the differential relative benefit rates received by physicians, with a bias in favour of the more expensive procedures and the consequent higher costs for the system as a whole. The physician's key role is emphasized in this study with the emphasis on supplier incentives and the inherent multiproduct nature of health care output. Economic theory predicts a movement along the production possibility frontier in output space in response to relative price changes. Econometric estimation of multiproduct production relations has been facilitated by the application of duality theory and the development of flexible functional forms. Duality theory establishes that the parameters of the production function can be represented equally well by the corresponding dual profit or cost function. Flexible functional forms for the profit function permit derivation of supply equations with relative prices as independent variables. Four elective surgical procedures were selected in order to estimate the aggregate substitution in production by physicians. With pooled cross-section and time series data for Canada for the period 1973 to 1981, the supply equations were estimated as a system, using the SURE estimation technique. Supply elasticities for price changes and changes in the key fixed factors were calculated. While emphasis was on the price response, the functional form incorporated the constraints imposed by the availability of hospital beds and surgical specialists. Evidence was found in support of the view that physicians allocate their time partly in response to changes in the prices of elective procedures relative to other procedures. With global budget constraints imposed on hospital expenditures, the four procedures, being elective, might possibly be given lower priority. Also, the estimated coefficients for the lagged dependent variables suggest that an inertia model of adjustment applies. Although incentives may exist in the fee structure to substitute toward the more expensive procedures, the results suggest that, at least for the period of the study. substitution was not on the basis of price alone. and that resource constraints. as proxied jointly by the number of hospital beds and surgical specialists, play a greater role in determining aggregate output. / Thesis / Doctor of Philosophy (PhD)

Submitted by Fernando Salazar (fernando.salazar@votorantimcorretora.com.br) on 2013-08-22T19:23:02Z No. of bitstreams: 1 Dissertação_FernandoSalazar_final.pdf: 716420 bytes, checksum: 1581ff723525f8a036c7a630a8650453 (MD5) / Approved for entry into archive by Suzinei Teles Garcia Garcia (suzinei.garcia@fgv.br) on 2013-08-23T12:25:24Z (GMT) No. of bitstreams: 1 Dissertação_FernandoSalazar_final.pdf: 716420 bytes, checksum: 1581ff723525f8a036c7a630a8650453 (MD5) / Made available in DSpace on 2013-08-23T12:36:41Z (GMT). No. of bitstreams: 1 Dissertação_FernandoSalazar_final.pdf: 716420 bytes, checksum: 1581ff723525f8a036c7a630a8650453 (MD5) Previous issue date: 2013-08-05 / This paper aims to investigate the competition aspects of banking multiproduct operation. Based on an extension of Panzar and Rosse (1987)’s test to the case of a multiproduct banking firm, we take advantage of a new dataset constructed to Brazilian banking conglomerates to infer the impact of conglomeration on market power. We find that banks offering classic (i.e., loans and credit cards) and other bank products (i.e., brokerage services, insurance and capitalization bonds) have substantially higher market power than the ones which offer only classic products. Results suggest a positive bias on the traditional estimates of competition in which the multioutput actions are not taken into account.

The study aims at investigating how revenue management techniques can be applied in industries which offer multiple products. Most of the companies nowadays trend to produce multiperoducts and they try to find the best method of selling. Therefore, revenue management can be considered as a new direction which should be developed for these firms. In this study, multi-product firms are mainly referred as firms offering a bundle of products or substitute products. In this regard, models and techniques applied in multiproduct firms are discussed and it is tried to provide basic models to better understand the problems, variables, customer choice models and constraints. The main methodology in this study is literature review. In order to carry out the research first revenue management applications and techniques are discussed to find a fit to this kind of industries. The main findings of this study are (1) identifying and analyzing the most important factors affecting decision making regarding managing of bundling and substitute products and ultimately total revenue of multiproduct firms. (2) Summarizing the results and knowledge obtained from various studies within fields of bundling and substitute products. (3) Discussing the possibility of applying different revenue management techniques to these fields. (4) Identifying potentials and new directions for future study with respect to both revenue management techniques and multiproduct firms.

This thesis is a theoretical analysis of optimal pricing by firms when consumer demands are uncertain. The purpose is to extend the familiar literature on single-product nonlinear pricing in two directions: to cases where the firm is regulated and to the case where the firm produces several products. Chapter 1 embeds these problems into the general setting of models of asymmetric information and, as well as covering existing work on the pricing decisions of firms facing adverse selection, discusses other areas including repeated contracts, auctions, signalling and the uses of what is known as the 'first-order approach'. Chapter 2 analyzes nonlinear pricing by a regulated single-product firm. As an alternative to requiring the firm to offer a given linear tariff two different types of regulation which allow nonlinear pricing are considered, namely, average revenue regulation and optional tariff regulation. Chapter 3 introduces the topic of multiproduct pricing when consumers have differing tastes for the various goods. The important simplifying assumption is that consumers wish to buy either one unit of a good or none at all. There are three main results: if consumers' taste parameters are continuously distributed then the firm will not offer all goods to all consumers; in the symmetric two-good case it is shown that (subject to a kind of 'hazard rate' condition) the firm will offer the bundle of two goods at a discount compared with the charge for the two goods separately; and the pricing strategy when the number of goods becomes large is solved approximately. Chapter 4 relaxes the assumption of unit demands and uses differential methods to analyze the multiproduct nonlinear pricing problem. In the symmetric case when taste parameters are continuously distributed the firm will choose to exclude some low-demand consumers from the market. It is shown that when parameters are independently distributed the firm will wish to introduce a degree of cross-dependence into its tariff. Sufficient conditions for a tariff to be optimal are derived and any tariff which satisfies these conditions necessarily will induce 'pure bundling', so that once a consumer decides to participate in the market at all she will choose to buy all goods. A class of cases is solved explicitly using these sufficient conditions. Since other solutions may be hard to solve analytically, a procedure for numerically generating solutions for the two-good case is described and two more solutions are described.

Submitted by ÁLVARO DE MARTINO LOURENÇÃO null (alvarodml@yahoo.com.br) on 2016-09-01T02:29:53Z No. of bitstreams: 1 dissertação final.pdf: 1977900 bytes, checksum: f021d291c786b9596621fda8c29bfa24 (MD5) / Approved for entry into archive by Ana Paula Grisoto (grisotoana@reitoria.unesp.br) on 2016-09-01T19:40:32Z (GMT) No. of bitstreams: 1 lourencao_am_me_bauru.pdf: 1977900 bytes, checksum: f021d291c786b9596621fda8c29bfa24 (MD5) / Made available in DSpace on 2016-09-01T19:40:32Z (GMT). No. of bitstreams: 1 lourencao_am_me_bauru.pdf: 1977900 bytes, checksum: f021d291c786b9596621fda8c29bfa24 (MD5) Previous issue date: 2016-07-04 / A gestão de estoque pode ser considerada como um dos principais componentes do planejamento e controle da produção. Na literatura acadêmica, inúmeros modelos matemáticos são apresentados para a gestão de estoque, os quais se referem a diferentes aspectos relacionados a essa gestão. O desenvolvimento de modelos de estoque eficientes e a adoção de métodos de otimização adequados para resolução desses modelos são necessários para o suporte à tomada de decisão. Neste trabalho, propõe-se um novo modelo de estoque que considera múltiplos produtos e múltiplas restrições de recursos, explorando o conceito de ponto de reposição e revisão periódica. Este problema é formulado como um problema de otimização não linear inteiro misto. Explora-se para a resolução deste modelo, uma abordagem baseada no método de Branch and Bound com o método de pontos interiores para a resolução dos problemas da árvore de busca. Testes computacionais são realizados com o modelo proposto e o método de resolução adotado. Os resultados obtidos evidenciam os seus potenciais para trabalhar com sistemas de estoque multiprodutos com múltiplas restrições. / Inventory management can be considered as one of the main components of planning and production control. In the academic literature, numerous mathematical models are presented for the inventory management, which refer to different aspects related to such a management. The development of efficient inventory models and the adoption of appropriate optimization methods for solving these models are needed to support decision-making. In this work, we propose a new inventory model that considers multiple products and multiple resource constraints, exploring the concept of replacement point and periodic review. This problem is formulated as a mixed integer non-linear optimization problem. For solving this model, an approach based on Branch and Bound method with interior point method for solving the search tree problems is explored. Computational tests are performed with the proposed model and the resolution method adopted. The obtained results show their potential to work with multiproduct inventory systems with multiple constraints.

Despite recent advances in computer power and the development of better algorithms, theoretical scheduling methodologies developed for batch-chemical production are seldom applied in industry (Musier & Evans 1989 and Grossmann et al. 1992). Scheduling decisions may have significant impact on overall company profitability by defining how capital is utilized, the operating costs required, and the ability to meet due dates. The purpose of this research is to compare different production scheduling methods by applying them to a real-world multi-stage, multi-product, batch-chemical production line. This research addresses the problem that the theoretical algorithms are seldom applied in industry and allows for performance analysis of several theoretical algorithms. The research presented in this thesis focuses on the development and comparison of several scheduling algorithms. The two objectives of this research are to: 1. modify different heuristic production scheduling algorithms to minimize tardiness for a multi-product batch plant involving multiple processing stages with several out-of-phase parallel machines in each stage; and 2. compare the robustness and performance of these production schedules using a stochastic discrete event simulation of a real-world production line. The following three scheduling algorithms are compared: 1. a modified Musier and Evans scheduling algorithm (1989); 2. a modified Ku and Karimi Sequence Building Algorithm (1991); and 3. a greedy heuristic based on an earliest-due-date (EDD) policy. Musier and Evans' heuristic improvement method (1989) is applied to the three algorithms. The computation times to determine the total tardiness of each schedule are compared. Finally, all the schedules are tested for robustness and performance in a stochastic setting with the use of a discrete event simulation (DES) model. Mignon, Honkomp, and Reklaitis' evaluation techniques (1995) and Multiple Comparison of the Best are used to help determine the best algorithm. / Master of Science