The effects of label design characteristics on perceptions of genetically modified food

Objective. To explore the effects on perceptions of labelling food for genetically modified content. Background: there is increasing public pressure for the compulsory labelling of genetically modified food content on all food products, and yet little is known about how the design and content of such food labels will influence product perceptions. The current research draws upon warning label research - a field in which the effect of label design manipulations on perceptions of, and responses to, potential or perceived risks is well documented. Method. Two experiments are reported that investigate how label design features influence the perception of genetically modified foods. The effects of label colour (red, blue and green), wording style (definitive vs. probabilistic and explicit vs. non-explicit) and information source (government agency, consumer group and manufacturer) on hazard perceptions and purchase intentions were measured. Results. Hazard perceptions and purchase intentions were both influenced by label design characteristics in predictable ways. Any reference to genetic modification, even if the label is stating that the product is free of genetically modified ingredients, increased hazard perception, and decreased purchase intentions, relative to a no-label condition. Conclusion. Label design effects generalise from warning label research to influence the perception of genetically modified foods in predictable ways. Application. The design of genetically modified food labels. © 2012 Copyright Taylor and Francis Group, LLC

eWOM: the effects of online consumer reviews on purchasing decision of electronic goods

Internet has become the primary source of information for a large number of consumers and it has dramatically changed the consumer behaviour. One of the main changes in modern consumer behaviour has been the transition from a passive to an active and informed consumer. Internet enables customers to share their opinions on, and experiences with, goods and services with a multitude of other consumers. Online consumer reviews are used by prospective buyers of related products who are interested in obtaining more information from people who have purchased and used a product of interest. Word-of-mouth (WOM) is one of the most important information sources when a consumer is making a purchase decision. The arrival and expansion of the Internet has extended consumers' options for gathering product information by including other consumers' comments, posted on the Internet, and has provided consumers opportunities to offer their own consumption-related advice by engaging in electronic word-of-mouth (eWOM). eWOM can be defined as all informal communications directed at consumers through Internet-based technology related to the usage or characteristics of particular goods and services, or their sellers. The aim of this study is to assess the impact of, one type of electronic word-of-mouth (eWOM), the online consumer review, on purchasing decision of electronic products. This empirical study also focuses on the relationship between reviews and purchasing behaviour. An instrument was prepared to measure the proposed constructs, with questionnaire items taken from prior studies but adapted to fit the context of e-commerce. The survey was applied to academicians in Turkey through internet. The data was analyzed using the SPSS package. The results show that consumer reviews have a causal impact on consumer purchasing behaviour and they have an effect on choosing the products by consumer. Finally, the results and their implications are discussed

Measurement in marketing

We distinguish three senses of the concept of measurement (measurement as the selection of observable indicators of theoretical concepts, measurement as the collection of data from respondents, and measurement as the formulation of measurement models linking observable indicators to latent factors representing the theoretical concepts), and we review important issues related to measurement in each of these senses. With regard to measurement in the first sense, we distinguish the steps of construct definition and item generation, and we review scale development efforts reported in three major marketing journals since 2000 to illustrate these steps and derive practical guidelines. With regard to measurement in the second sense, we look at the survey process from the respondent's perspective and discuss the goals that may guide participants' behavior during a survey, the cognitive resources that respondents devote to answering survey questions, and the problems that may occur at the various steps of the survey process. Finally, with regard to measurement in the third sense, we cover both reflective and formative measurement models, and we explain how researchers can assess the quality of measurement in both types of measurement models and how they can ascertain the comparability of measurements across different populations of respondents or conditions of measurement. We also provide a detailed empirical example of measurement analysis for reflective measurement models

Moving from Data-Constrained to Data-Enabled Research: Experiences and Challenges in Collecting, Validating and Analyzing Large-Scale e-Commerce Data

Widespread e-commerce activity on the Internet has led to new opportunities to collect vast amounts of micro-level market and nonmarket data. In this paper we share our experiences in collecting, validating, storing and analyzing large Internet-based data sets in the area of online auctions, music file sharing and online retailer pricing. We demonstrate how such data can advance knowledge by facilitating sharper and more extensive tests of existing theories and by offering observational underpinnings for the development of new theories. Just as experimental economics pushed the frontiers of economic thought by enabling the testing of numerous theories of economic behavior in the environment of a controlled laboratory, we believe that observing, often over extended periods of time, real-world agents participating in market and nonmarket activity on the Internet can lead us to develop and test a variety of new theories. Internet data gathering is not controlled experimentation. We cannot randomly assign participants to treatments or determine event orderings. Internet data gathering does offer potentially large data sets with repeated observation of individual choices and action. In addition, the automated data collection holds promise for greatly reduced cost per observation. Our methods rely on technological advances in automated data collection agents. Significant challenges remain in developing appropriate sampling techniques integrating data from heterogeneous sources in a variety of formats, constructing generalizable processes and understanding legal constraints. Despite these challenges, the early evidence from those who have harvested and analyzed large amounts of e-commerce data points toward a significant leap in our ability to understand the functioning of electronic commerce.Comment: Published at http://dx.doi.org/10.1214/088342306000000231 in the Statistical Science (http://www.imstat.org/sts/) by the Institute of Mathematical Statistics (http://www.imstat.org

The New Basel Capital Accord: Structure, Possible Changes and Micro- and Macroeconomic Effects. CEPS Reports in Finance and Banking No. 30, 1 September 2002

During the last 12 years, the 1988 Basel Capital Accord dealing with minimum capital requirements for internationally active financial institutions has grown more pervasive, being integrated into national regulations in most advanced countries. Meanwhile, the limitations and drawbacks of the simple rules on which it is based have become increasingly apparent. In other words, the existence of a gap between supervisory requirements and risk-based measures of economic capital has led to forms of regulatory arbitrage (whereby loopholes in the regulation have been exploited to increase the real leverage of a bank without reducing its capital ratios). Paradoxically, the inability of the 1988 protocol to discriminate between investment grade and junk borrowers might also have made some financial institutions more risk-seeking, instead of helping them control their risks. To address such challenges, the Basel Committee on Banking Supervision has been engaged for several years in a revision process that will finally lead to a New Basel Capital Accord (NBCA). Remarkably, the new Accord is not being engineered inside a secluded laboratory by a handful of regulators and financial rocket-scientists, but its contents have been thoroughly discussed by national supervisors, banks and academics. Thus, the NBCA drafting has become a meeting point for many different perspectives: legal experts, accountants, bank managers, central bankers and finance scholars (to name only a few) have been working together, merging their professional backgrounds to make the NBCA more robust in its structure and parameters. This report tries to provide a complete, up-to-date, critical picture of the new Basel approach to bank capital, by summarising its structure and possible changes, and by focusing on some limitations and pitfalls that might deserve further investigation

The Role of the Mangement Sciences in Research on Personalization

We present a review of research studies that deal with personalization. We synthesize current knowledge about these areas, and identify issues that we envision will be of interest to researchers working in the management sciences. We take an interdisciplinary approach that spans the areas of economics, marketing, information technology, and operations. We present an overarching framework for personalization that allows us to identify key players in the personalization process, as well as, the key stages of personalization. The framework enables us to examine the strategic role of personalization in the interactions between a firm and other key players in the firm's value system. We review extant literature in the strategic behavior of firms, and discuss opportunities for analytical and empirical research in this regard. Next, we examine how a firm can learn a customer's preferences, which is one of the key components of the personalization process. We use a utility-based approach to formalize such preference functions, and to understand how these preference functions could be learnt based on a customer's interactions with a firm. We identify well-established techniques in management sciences that can be gainfully employed in future research on personalization.CRM, Persoanlization, Marketing, e-commerce,

Dimensionality of risk perception : factors affecting consumer understanding and evaluation of financial risk

This article describes two studies of the factors affecting consumer understanding of financial risk. The first study investigated factors affecting people's perception and comprehension of information about the risks related to retirement investments. First, we asked respondents to list possible risk factors related to investment in a pension plan. Then we obtained ratings of different factors (e.g., the perceived level of knowledge about an investment) that could affect perception of the risk of financial products and retirement investment decisions. Finally, we asked the subjects to rate 11 different descriptions presenting risk information about the same financial product. The risk information framing that received highest rating presented risk as variation between minimum and maximum values with an average in between. The second study demonstrated the risk framing that received highest ranking also prompted more stable risk preferences over a 3-month testing period in comparison to standard measures of risk aversion. Thus, the second study corroborated the importance of the findings in the first study and also indicated that, although people can exhibit stable risk preferences if we ask them the right questions, these preferences were very specific to the risk domain

Cognitive finance: Behavioural strategies of spending, saving, and investing.

Research in economics is increasingly open to empirical results. The advances in behavioural approaches are expanded here by applying cognitive methods to financial questions. The field of "cognitive finance" is approached by the exploration of decision strategies in the financial settings of spending, saving, and investing. Individual strategies in these different domains are searched for and elaborated to derive explanations for observed irregularities in financial decision making. Strong context-dependency and adaptive learning form the basis for this cognition-based approach to finance. Experiments, ratings, and real world data analysis are carried out in specific financial settings, combining different research methods to improve the understanding of natural financial behaviour. People use various strategies in the domains of spending, saving, and investing. Specific spending profiles can be elaborated for a better understanding of individual spending differences. It was found that people differ along four dimensions of spending, which can be labelled: General Leisure, Regular Maintenance, Risk Orientation, and Future Orientation. Saving behaviour is strongly dependent on how people mentally structure their finance and on their self-control attitude towards decision space restrictions, environmental cues, and contingency structures. Investment strategies depend on how companies, in which investments are placed, are evaluated on factors such as Honesty, Prestige, Innovation, and Power. Further on, different information integration strategies can be learned in decision situations with direct feedback. The mapping of cognitive processes in financial decision making is discussed and adaptive learning mechanisms are proposed for the observed behavioural differences. The construal of a "financial personality" is proposed in accordance with other dimensions of personality measures, to better acknowledge and predict variations in financial behaviour. This perspective enriches economic theories and provides a useful ground for improving individual financial services

Accumulation is late and brief in preferential choice

Preferential choices are often explained using models within the evidence accumulation framework: value drives the drift rate at which evidence is accumulated until a threshold is reached and an option is chosen. Although rarely stated explicitly, almost all such models assume that decision makers have knowledge at the onset of the choice of all available attributes and options. In reality however, choice information is viewed piece-by-piece, and is often not completely acquired until late in the choice, if at all. Across four eye-tracking experiments, we show that whether the information was acquired early or late is irrelevant in predicting choice: all that matters is whether or not it was acquired at all. Models with potential alternative assumptions were posited and tested, such as 1) accumulation of instantaneously available information or 2) running estimates as information is acquired. These provided poor fits to the data. We are forced to conclude that participants either are clairvoyant, accumulating using information before they have looked at it, or delay accumulating evidence until very late in the choice, so late that the majority of choice time is not time in which evidence is accumulated. Thus, although the evidence accumulation framework may still be useful in measurement models, it cannot account for the details of the processes involved in decision making

Popular Attitudes, Globalization, and Risk

Popular opposition to globalization may be interpreted as xenophobia or hostility to market economics and signal country risk, including the degree of security risk - the possibility that local staff of facilities could be subject to discriminatory treatment, harassment, or attack. This paper integrates the Pew Global Attitudes data into a series of economic models on foreign direct investment (FDI), sovereign ratings, and local entrepreneurship and finds that some responses correlate with economic variables of interest, conveying information beyond what can be explained through standard models. More tolerant countries attract more FDI, obtain better ratings, and exhibit more entrepreneurship.Globalization, risk, foreign direct investment, sovereign ratings, entrepreneurship