Pub Date : 2024-11-01DOI: 10.1016/j.regsciurbeco.2024.104059
Alberto Hidalgo
Tourism is an essential sector of the global economy, contributing significantly to GDP and employment. Despite its importance, our understanding of its impact on urban economic activity remains limited. This paper aims to fill this gap by examining the impact of tourism on urban transformation using a dataset of hotel openings in Madrid from 2001–2010. I show that hotel openings positively impact the number of establishments and employment by using the number of protected buildings as an instrumental variable to account for the non-random distribution of hotel openings. Interestingly, hotel openings contribute to changes in the composition of the economic activities and the business structures, enhancing tourist-oriented corporate-owned businesses over other individual-owned companies. Finally, economic effects extend to the real estate market, increasing rental prices and residential investment.
{"title":"Your room is ready: Tourism and urban revival","authors":"Alberto Hidalgo","doi":"10.1016/j.regsciurbeco.2024.104059","DOIUrl":"10.1016/j.regsciurbeco.2024.104059","url":null,"abstract":"<div><div>Tourism is an essential sector of the global economy, contributing significantly to GDP and employment. Despite its importance, our understanding of its impact on urban economic activity remains limited. This paper aims to fill this gap by examining the impact of tourism on urban transformation using a dataset of hotel openings in Madrid from 2001–2010. I show that hotel openings positively impact the number of establishments and employment by using the number of protected buildings as an instrumental variable to account for the non-random distribution of hotel openings. Interestingly, hotel openings contribute to changes in the composition of the economic activities and the business structures, enhancing tourist-oriented corporate-owned businesses over other individual-owned companies. Finally, economic effects extend to the real estate market, increasing rental prices and residential investment.</div></div>","PeriodicalId":48196,"journal":{"name":"Regional Science and Urban Economics","volume":"109 ","pages":"Article 104059"},"PeriodicalIF":3.5,"publicationDate":"2024-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142571429","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-11-01DOI: 10.1016/j.regsciurbeco.2024.104063
Marina Di Giacomo , Giovanni Perucca , Massimiliano Piacenza , Gilberto Turati
We focus on caesarean sections (C-sections) to examine access to appropriate medical care for immigrants in the Italian tax-funded universal National Health Service. We use a detailed micro-dataset to analyse whether non-native women receive different treatments compared to natives and whether there are differences between groups of non-natives defined by citizenship. For identification, we control for hospital fixed effects and maternal characteristics, and we compare the different groups by exploiting the clustering of non-natives of different nationalities in different urban areas. We find no significant differences between natives and non-natives in terms of C-sections and inappropriate C-sections. However, we do find significant differences between different groups of immigrants. In addition, we find that linguistic and socio-cultural distances are significant drivers of inequalities among non-native women. As language, habits, traditions, and beliefs can affect communication between the woman and the medical staff in many ways, we interpret our findings in terms of the ability to process and understand information between the two parties. In support of this interpretation, we find evidence of a “segregation effect”: women linguistically and socio-culturally more distant from Italy experience the greatest difficulties in accessing appropriate care when living in urban areas characterized by the presence of large immigrant communities of the same nationality. Moreover, we find that the role of linguistic and socio-cultural barriers is stronger for first-time mothers and women with non-native partners.
{"title":"Immigrants' clusters and unequal access to healthcare treatments","authors":"Marina Di Giacomo , Giovanni Perucca , Massimiliano Piacenza , Gilberto Turati","doi":"10.1016/j.regsciurbeco.2024.104063","DOIUrl":"10.1016/j.regsciurbeco.2024.104063","url":null,"abstract":"<div><div>We focus on caesarean sections (C-sections) to examine access to appropriate medical care for immigrants in the Italian tax-funded universal National Health Service. We use a detailed micro-dataset to analyse whether non-native women receive different treatments compared to natives and whether there are differences between groups of non-natives defined by citizenship. For identification, we control for hospital fixed effects and maternal characteristics, and we compare the different groups by exploiting the clustering of non-natives of different nationalities in different urban areas. We find no significant differences between natives and non-natives in terms of C-sections and inappropriate C-sections. However, we do find significant differences between different groups of immigrants. In addition, we find that linguistic and socio-cultural distances are significant drivers of inequalities among non-native women. As language, habits, traditions, and beliefs can affect communication between the woman and the medical staff in many ways, we interpret our findings in terms of the ability to process and understand information between the two parties. In support of this interpretation, we find evidence of a “segregation effect”: women linguistically and socio-culturally more distant from Italy experience the greatest difficulties in accessing appropriate care when living in urban areas characterized by the presence of large immigrant communities of the same nationality. Moreover, we find that the role of linguistic and socio-cultural barriers is stronger for first-time mothers and women with non-native partners.</div></div>","PeriodicalId":48196,"journal":{"name":"Regional Science and Urban Economics","volume":"109 ","pages":"Article 104063"},"PeriodicalIF":3.5,"publicationDate":"2024-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142651914","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-11-01DOI: 10.1016/j.regsciurbeco.2024.104056
Zhi-Chun Li , Yao Deng , André de Palma
Employer-provided parking (EP) has become a prevalent way to reduce employees' parking delays and late arrivals through offering them free or low-price parking spaces at the workplace. This paper explores the EP effects on employees' trip scheduling, employer's EP investment decision, and commercial parking operator's pricing decision. An analytical trip scheduling equilibrium model is first presented to model the interaction between EP provision and employees' departure time choices during morning commute. A profit maximization model incorporating the employee productivity is then developed to determine the employer's optimal EP investment decision. A competitive game between employer's investment decision and commercial parking operator's parking pricing decision is analytically investigated, together with the effects of EP investment on social welfare. The results show that the EP investment can lead to a win-win situation with decreased employee commuting cost and increased firm production output; and the employer would like to provide only part of the employees with EP services. The competitive game solutions depend very much on the marginal costs of EP and commercial parking spaces. The EP investment with an excessively high commercial parking fee may hurt the society due to decreased social welfare.
雇主提供停车位（EP）通过在工作场所为员工提供免费或低价停车位来减少员工的停车延误和迟到现象，已成为一种普遍的方式。本文探讨了雇主提供停车位对员工出行安排、雇主提供停车位投资决策和商业停车运营商定价决策的影响。本文首先提出了一个分析性的行程安排均衡模型，以模拟在早上通勤期间提供免费停车位与员工出发时间选择之间的相互作用。然后建立了一个包含员工生产率的利润最大化模型，以确定雇主的最佳 EP 投资决策。分析研究了雇主的投资决策与商业停车运营商的停车定价决策之间的竞争博弈，以及 EP 投资对社会福利的影响。结果表明，环境优化投资可以带来双赢局面，即员工通勤成本降低，企业生产产出增加；而雇主只愿意为部分员工提供环境优化服务。竞争博弈方案在很大程度上取决于环保型停车位和商业停车位的边际成本。环境优化投资与过高的商业停车费可能会因社会福利减少而损害社会。
{"title":"Employer-provided parking: Departure time choice, investment decision, and welfare effects","authors":"Zhi-Chun Li , Yao Deng , André de Palma","doi":"10.1016/j.regsciurbeco.2024.104056","DOIUrl":"10.1016/j.regsciurbeco.2024.104056","url":null,"abstract":"<div><div>Employer-provided parking (EP) has become a prevalent way to reduce employees' parking delays and late arrivals through offering them free or low-price parking spaces at the workplace. This paper explores the EP effects on employees' trip scheduling, employer's EP investment decision, and commercial parking operator's pricing decision. An analytical trip scheduling equilibrium model is first presented to model the interaction between EP provision and employees' departure time choices during morning commute. A profit maximization model incorporating the employee productivity is then developed to determine the employer's optimal EP investment decision. A competitive game between employer's investment decision and commercial parking operator's parking pricing decision is analytically investigated, together with the effects of EP investment on social welfare. The results show that the EP investment can lead to a win-win situation with decreased employee commuting cost and increased firm production output; and the employer would like to provide only part of the employees with EP services. The competitive game solutions depend very much on the marginal costs of EP and commercial parking spaces. The EP investment with an excessively high commercial parking fee may hurt the society due to decreased social welfare.</div></div>","PeriodicalId":48196,"journal":{"name":"Regional Science and Urban Economics","volume":"109 ","pages":"Article 104056"},"PeriodicalIF":3.5,"publicationDate":"2024-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142593704","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-11-01DOI: 10.1016/j.regsciurbeco.2024.104064
Hugh Gravelle , Giuseppe Moscelli , Rita Santos , Luigi Siciliani
The hospital sector is frequently subject to reconfigurations, with some departments closing and new ones opening. Using a conditional logit model based on observed patient choices, we quantify the effects of a hospital department closure on the welfare of elective hip replacement patients in England. We simulate eight separate closures of the provider with lowest quality, as measured by one of four quality measures: revisions, emergency readmissions, 30-day mortality, change in the Oxford Hip Score, in urban and rural areas. The average reduction in welfare for patients who attended the closed hospital is equivalent to having to travel between two and ten additional kilometres for treatment, compared to their average travel distance, pre-closure, of 17.4 km. The reduction in patient welfare is generally more pronounced when closing a hospital in a rural area (about 50% higher when quality is measured by the Oxford Hip Score and emergency readmissions).
{"title":"Hospital closure in urban and rural areas and patients’ welfare","authors":"Hugh Gravelle , Giuseppe Moscelli , Rita Santos , Luigi Siciliani","doi":"10.1016/j.regsciurbeco.2024.104064","DOIUrl":"10.1016/j.regsciurbeco.2024.104064","url":null,"abstract":"<div><div>The hospital sector is frequently subject to reconfigurations, with some departments closing and new ones opening. Using a conditional logit model based on observed patient choices, we quantify the effects of a hospital department closure on the welfare of elective hip replacement patients in England. We simulate eight separate closures of the provider with lowest quality, as measured by one of four quality measures: revisions, emergency readmissions, 30-day mortality, change in the Oxford Hip Score, in urban and rural areas. The average reduction in welfare for patients who attended the closed hospital is equivalent to having to travel between two and ten <em>additional</em> kilometres for treatment, compared to their average travel distance, pre-closure, of 17.4 km. The reduction in patient welfare is generally more pronounced when closing a hospital in a rural area (about 50% higher when quality is measured by the Oxford Hip Score and emergency readmissions).</div></div>","PeriodicalId":48196,"journal":{"name":"Regional Science and Urban Economics","volume":"109 ","pages":"Article 104064"},"PeriodicalIF":3.5,"publicationDate":"2024-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142651913","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-11-01DOI: 10.1016/j.regsciurbeco.2024.104057
Marco Di Cataldo , Giulia Romani
The availability of public education services can influence residential choices. Therefore, policies aimed at ‘rationalising’ service provision by reducing the number of undersized nodes in the public school network can lead to population decline, especially in spatially isolated areas lacking valid alternatives to the removed services. This paper examines the demographic and income effects of primary school closures by exploiting an Italian education reform that resulted in the contraction of the school network. We assess whether school closures impact households’ residential choices, over and above preexisting negative population trends that motivate school closures. Our findings indicate that municipalities affected by school closures experience significant reductions in population and income. The effect is primarily driven by peripheral municipalities located far away from economic centres and distant from the next available primary school. This evidence indicates that school ‘rationalisation policies’, by fostering depopulation of peripheral areas, have an influence on the spatial distribution of households and income, thus affecting territorial disparities.
{"title":"Rational cuts? The local impact of closing undersized schools","authors":"Marco Di Cataldo , Giulia Romani","doi":"10.1016/j.regsciurbeco.2024.104057","DOIUrl":"10.1016/j.regsciurbeco.2024.104057","url":null,"abstract":"<div><div>The availability of public education services can influence residential choices. Therefore, policies aimed at ‘rationalising’ service provision by reducing the number of undersized nodes in the public school network can lead to population decline, especially in spatially isolated areas lacking valid alternatives to the removed services. This paper examines the demographic and income effects of primary school closures by exploiting an Italian education reform that resulted in the contraction of the school network. We assess whether school closures impact households’ residential choices, over and above preexisting negative population trends that motivate school closures. Our findings indicate that municipalities affected by school closures experience significant reductions in population and income. The effect is primarily driven by peripheral municipalities located far away from economic centres and distant from the next available primary school. This evidence indicates that school ‘rationalisation policies’, by fostering depopulation of peripheral areas, have an influence on the spatial distribution of households and income, thus affecting territorial disparities.</div></div>","PeriodicalId":48196,"journal":{"name":"Regional Science and Urban Economics","volume":"109 ","pages":"Article 104057"},"PeriodicalIF":3.5,"publicationDate":"2024-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142553558","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-11-01DOI: 10.1016/j.regsciurbeco.2024.104060
Tomoya Mori , Jens Wrona
Using Japanese inter-city trade data, we find a substantial centrality bias in aggregate gravity estimations: Shipments from large cities (central places) to their hinterland are 50%–125% larger than predicted by gravity forces. We argue that this discrepancy results from aggregating across industries, that concentrate in a few central places, which predominantly serve their respective hinterlands. Decomposing the centrality bias along the margins of our data, we attribute most of the centrality bias to substantially larger extensive industry margins in exports from larger cities to their smaller hinterland cities than vice versa.
{"title":"Centrality bias in inter-city trade","authors":"Tomoya Mori , Jens Wrona","doi":"10.1016/j.regsciurbeco.2024.104060","DOIUrl":"10.1016/j.regsciurbeco.2024.104060","url":null,"abstract":"<div><div>Using Japanese inter-city trade data, we find a substantial centrality bias in aggregate gravity estimations: Shipments from large cities (central places) to their hinterland are 50%–125% larger than predicted by gravity forces. We argue that this discrepancy results from aggregating across industries, that concentrate in a few central places, which predominantly serve their respective hinterlands. Decomposing the centrality bias along the margins of our data, we attribute most of the centrality bias to substantially larger extensive industry margins in exports from larger cities to their smaller hinterland cities than vice versa.</div></div>","PeriodicalId":48196,"journal":{"name":"Regional Science and Urban Economics","volume":"109 ","pages":"Article 104060"},"PeriodicalIF":3.5,"publicationDate":"2024-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142560597","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-10-17DOI: 10.1016/j.regsciurbeco.2024.104053
Travis St. Clair
Immigration raises important political and economic questions, yet there remains considerable disagreement about its short- and long-term consequences. This paper examines the fiscal consequences of immigration for local governments. Previous work has highlighted the gap between the long-term economic benefits of immigration and the short-term fiscal burden posed by recent arrivals, however several influential estimates based on cash-flow accounting suffer from potential bias. I use a quasi-experimental approach to re-examine a famous case: the large wave of Cuban refugees that landed in Miami in 1980, otherwise known as the Mariel Boatlift. Using a synthetic control design, I find that per-pupil education costs increased in Miami in the aftermath of the Boatlift, financed by an increase in state transfers. These effects persisted for at least ten years. The results shed light on the heterogeneous impacts of immigration over time and space.
{"title":"The fiscal effects of immigration on local governments: Revisiting the Mariel Boatlift","authors":"Travis St. Clair","doi":"10.1016/j.regsciurbeco.2024.104053","DOIUrl":"10.1016/j.regsciurbeco.2024.104053","url":null,"abstract":"<div><div>Immigration raises important political and economic questions, yet there remains considerable disagreement about its short- and long-term consequences. This paper examines the fiscal consequences of immigration for local governments. Previous work has highlighted the gap between the long-term economic benefits of immigration and the short-term fiscal burden posed by recent arrivals, however several influential estimates based on cash-flow accounting suffer from potential bias. I use a quasi-experimental approach to re-examine a famous case: the large wave of Cuban refugees that landed in Miami in 1980, otherwise known as the Mariel Boatlift. Using a synthetic control design, I find that per-pupil education costs increased in Miami in the aftermath of the Boatlift, financed by an increase in state transfers. These effects persisted for at least ten years. The results shed light on the heterogeneous impacts of immigration over time and space.</div></div>","PeriodicalId":48196,"journal":{"name":"Regional Science and Urban Economics","volume":"109 ","pages":"Article 104053"},"PeriodicalIF":3.5,"publicationDate":"2024-10-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142529564","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-10-09DOI: 10.1016/j.regsciurbeco.2024.104054
John S. Heywood , Zheng Wang
This paper uniquely examines an international mixed oligopoly in a model of spatial price discrimination. It isolates the importance of the location of the border showing a variety of equilibria depending on the nationality and placement of the private rivals. While the presence of a public firm often improves domestic welfare, it need not. Moreover, a prisoner's dilemma can exist in which each country would benefit from the privatization of both public firms but neither country has a unilateral incentive to privatize. The implications are discussed.
{"title":"Public firms on an international border: A model of spatial price discrimination","authors":"John S. Heywood , Zheng Wang","doi":"10.1016/j.regsciurbeco.2024.104054","DOIUrl":"10.1016/j.regsciurbeco.2024.104054","url":null,"abstract":"<div><div>This paper uniquely examines an international mixed oligopoly in a model of spatial price discrimination. It isolates the importance of the location of the border showing a variety of equilibria depending on the nationality and placement of the private rivals. While the presence of a public firm often improves domestic welfare, it need not. Moreover, a prisoner's dilemma can exist in which each country would benefit from the privatization of both public firms but neither country has a unilateral incentive to privatize. The implications are discussed.</div></div>","PeriodicalId":48196,"journal":{"name":"Regional Science and Urban Economics","volume":"109 ","pages":"Article 104054"},"PeriodicalIF":3.5,"publicationDate":"2024-10-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142438222","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Forward-looking economic agents operating in a finite continuous geographic area choose how much to innovate at each point in time and space. Based on this assumption, the present study incorporates spatial interactions in endogenous growth models, addressing the criticism that such models are inconsistent with empirical evidence. More specifically, we introduce spatial production spillovers, knowledge diffusion across space, and the capability for spatial heterogeneity into a standard expanding variety growth model based on R&D. We study the properties of equilibrium and optimal allocations and argue that the characteristics are different from those of the non-spatial model, which alter the appropriate policy measures. Finally, we provide numerical examples demonstrating the importance of spatial dependent policy measures in achieving a balanced regional development.
{"title":"Spatial externalities, R&D spillovers, and endogenous technological change","authors":"Spyridon Tsangaris , Anastasios Xepapadeas , Athanasios N. Yannacopoulos , Luca Salvati","doi":"10.1016/j.regsciurbeco.2024.104055","DOIUrl":"10.1016/j.regsciurbeco.2024.104055","url":null,"abstract":"<div><div>Forward-looking economic agents operating in a finite continuous geographic area choose how much to innovate at each point in time and space. Based on this assumption, the present study incorporates spatial interactions in endogenous growth models, addressing the criticism that such models are inconsistent with empirical evidence. More specifically, we introduce spatial production spillovers, knowledge diffusion across space, and the capability for spatial heterogeneity into a standard expanding variety growth model based on R&D. We study the properties of equilibrium and optimal allocations and argue that the characteristics are different from those of the non-spatial model, which alter the appropriate policy measures. Finally, we provide numerical examples demonstrating the importance of spatial dependent policy measures in achieving a balanced regional development.</div></div>","PeriodicalId":48196,"journal":{"name":"Regional Science and Urban Economics","volume":"109 ","pages":"Article 104055"},"PeriodicalIF":3.5,"publicationDate":"2024-10-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142529563","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-09-30DOI: 10.1016/j.regsciurbeco.2024.104052
Tai-Liang Chen , Mingjie Yang
In a mature product market, brands compete aggressively with each other using a marketing mix that includes position, pricing, and managerial delegation to win loyal customers and gain a larger market share. We examine the effects of brand loyalty on the endogenous choices of managerial compensation contracts and optimal brand positions in an uncovered market model. We analytically compare 18 symmetric and asymmetric mutual delegation cases associated with three delegation schemes—no delegation, sales delegation and relative performance (RP) delegation—in the Bertrand and Cournot competition modes. In the case of symmetric mutual contracts, under Bertrand competition, a price commitment effect resulting from the delegation decision weakens the competition, inducing higher prices and profits for both brands regardless of the type of delegation scheme. Under Cournot competition, delegation decisions can be viewed as signals to promote competition, intensifying the degree of competition. To acquire more loyal customers and higher profits, mutual RP delegation is the dominant choice under Bertrand competition, whereas mutual profit maximization is the dominant choice under Cournot competition. Furthermore, the social welfare is the highest when both brands optimally choose the RP delegation under Bertrand or optimally choose no delegation under Cournot; however, consumer surpluses are the lowest in both optimal cases.
在一个成熟的产品市场中，品牌之间会利用包括定位、定价和管理授权在内的营销组合展开激烈竞争，以赢得忠诚客户和更大的市场份额。我们在一个无覆盖市场模型中研究了品牌忠诚度对经理报酬合同和最佳品牌地位的内生选择的影响。我们分析比较了伯特兰竞争模式和库诺竞争模式下与三种委托方案--无委托、销售委托和相对业绩（RP）委托--相关的 18 种对称和非对称相互委托情况。在对称相互委托的情况下，在伯特兰竞争模式下，委托决策所产生的价格承诺效应会削弱竞争，从而导致两个品牌的价格和利润都提高，而不管委托方案的类型如何。在库诺竞争下，委托决策可视为促进竞争的信号，会加剧竞争程度。为了获得更多忠诚客户和更高利润，在伯特兰竞争下，相互 RP 委托是主要选择，而在库诺竞争下，相互利润最大化是主要选择。此外，当两个品牌在伯特兰竞争中都最优化地选择 RP 授权或在库诺竞争中都最优化地选择不授权时，社会福利最高；但在两种最优情况下，消费者盈余都最低。
{"title":"Brand loyalty, managerial delegation and position choices: Bertrand versus Cournot competition","authors":"Tai-Liang Chen , Mingjie Yang","doi":"10.1016/j.regsciurbeco.2024.104052","DOIUrl":"10.1016/j.regsciurbeco.2024.104052","url":null,"abstract":"<div><div>In a mature product market, brands compete aggressively with each other using a marketing mix that includes position, pricing, and managerial delegation to win loyal customers and gain a larger market share. We examine the effects of brand loyalty on the endogenous choices of managerial compensation contracts and optimal brand positions in an uncovered market model. We analytically compare 18 symmetric and asymmetric mutual delegation cases associated with three delegation schemes—no delegation, sales delegation and relative performance (RP) delegation—in the Bertrand and Cournot competition modes. In the case of symmetric mutual contracts, under Bertrand competition, a price commitment effect resulting from the delegation decision weakens the competition, inducing higher prices and profits for both brands regardless of the type of delegation scheme. Under Cournot competition, delegation decisions can be viewed as signals to promote competition, intensifying the degree of competition. To acquire more loyal customers and higher profits, mutual RP delegation is the dominant choice under Bertrand competition, whereas mutual profit maximization is the dominant choice under Cournot competition. Furthermore, the social welfare is the highest when both brands optimally choose the RP delegation under Bertrand or optimally choose no delegation under Cournot; however, consumer surpluses are the lowest in both optimal cases.</div></div>","PeriodicalId":48196,"journal":{"name":"Regional Science and Urban Economics","volume":"109 ","pages":"Article 104052"},"PeriodicalIF":3.5,"publicationDate":"2024-09-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"142426474","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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