This dissertation explores the intricacies associated with the use of distance
functions in empirical studies. It focuses on the measurement of advertising
efficiency and investigates the properties of the models that seek to approximate
the abatement costs of socially undesirable outputs. The first manuscript is
devoted to the development of the algorithm that can be used to measure the
efficiency with which firms market their brands in the presence of advertising by
rivals. An empirical illustration is carried out using the data from the U.S. brewing
industry. The second study analyzes the difficulties associated with the accurate
approximation of the abatement costs of socially undesirable outputs. It contrasts
the results from a variety of different shadow-pricing models, each of which relies
on a different type of distance functions that are used to approximate the polluting
technology. The shadow prices of sulfur dioxide are computed using linear
programming techniques and the data from the U.S. electric utility industry. The
third manuscript shows how a generalized method of moments (GMM) algorithm
can be used to estimate the parameters of certain types of distance functions; the
empirical illustration is carried out using the data set from the second study.
The first manuscript illustrates that advertising spillovers are important in
brewing and shows that the estimates of marketing efficiency are inaccurate when
spillover effects are present and ignored. The second study shows that the shadow
price estimates of socially undesirable outputs are not invariant to the assumptions
regarding the parametric form of production technology and can in fact be
predetermined by selecting a specific model. Finally, the third study established
the legitimacy of the GMM procedure as a choice of an algorithm for the shadow
pricing of undesirable outputs. / Graduation date: 2005
| Identifer | oai:union.ndltd.org:ORGSU/oai:ir.library.oregonstate.edu:1957/28730 |
| Date | 20 May 2005 |
| Creators | Vardanyan, Mikayel |
| Contributors | Fare, Rolf, Martins-Filho, Carlos |
| Source Sets | Oregon State University |
| Language | en_US |
| Detected Language | English |
| Type | Thesis/Dissertation |
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