Can We Identify Balassa-Samuelson Effects with Measures of Product Variety?

The Balassa-Samuelson hypothesis - i.e. that real exchange rates between each pair of countries increase with the tradables sector productivities ratio between these countries, and decrease with their non-tradables sector productivities ratio - has been one of the most prominent frameworks in open economy macroeconomics for more than forty years. However, empirical studies have often been unable to confirm it. We argue that this might at least in part be due to measurement errors leading to downward-biased estimates. We test the Balassa-Samuelson hypothesis with innovative trade-based vari-ety measures to differentiate between tradables and non-tradables sector productivities that do not suffer from such errors-in-variables. Using a pairwise regression approach, we find stable and very robust Balassa-Samuelson effects over all our specifications

Details of a scientific approach to information systems, Courant Symp. in Data Base Systems

are the optimal strategy for the usage considered. If it is assumed now that all q s = 0 (i.e. there is no querying to the IPS) then it is clear that no indexing path is profitable. Rule 4 If only queries and no maintenance are performed then all the candidate indexing paths are included in the optimal strategy whereas if maintenance only is done, no indexing path appears in the IPS. Conclusions A file designer who cannot determine the effects of each alternative decision is bound to make subjective or intuitive design judgements instead of objective ones. The properties and rules stated (a) provide the means to improve the performance of IPS by expanding the current spectrum of alternative indexing paths examined prior to making any implementation decision, and (b) provide for increased confidence in the decision made. In Book review A Programming Metholodology in Compiler Construction Part I: Concepts by J. Lewi, K. De Vlaminck, J. Huens and M. Huybrechts, 1979; 308 pages. (North-Holland, $41.50) In the late 1950s the task of compiler construction was considered a major undertaking. The first FORTRAN compiler, for example, took 18 man-years to implement (Backus et al, 1957). Now, in the late 1970s, such a task is considered a reasonable computer science student project. The factors that have led to this over the last twenty years are (a) the comprehension of the organisation and modular design of the compilation process, (b) the development of systematic techniques for handling the majority of the important tasks that occur during compilation and (c) the construction of software tools that assist in the implementation of compilers and compiler components. Implicit in all these three developments is the closing of the gap between theory and practice. This book is the first part of a twopart description of an environment utilising a completely closed gap. Part I introduces the basic theoretical models whilst part 2 will consider the more practical aspects of the engineering of the environment (namely the language implementation laboratory [LILA] [transducer] programs from the associated syntax. As such, each section is the logical progression of the previous and the methodology used in each section is a reflection of the methodology of the previous section. Hence the book is structurally pleasing and easy to read. In conclusion, the book is ideally suited to the software engineer who is actively involved in the application of language theory to compiler construction (or the construction of any systems softwar

Getting at the truth or getting along: Accuracy-versus impression-motivated heuristic and systematic processing

The choice between novelty and familiarity when introducing a redesigned product is a crucial decision. A look into the processes of object perception reveals that novelty and similarity/familiarity are not two poles of the same dimension. Instead it is possible that consumers can perceive new products as both novel from and similar to a former product. Based on the 4-stage model of object perception this paper provides an explanation of how specific visual design stimuli (line and surface) affect brand recognition and novelty perception. Results from experimental studies are presented. [to cite]: Robert Kreuzbauer, Jan Schoormans, and Dirk Snelders (2007) , [url]: http://www.acrwebsite.org/volumes/12826/volumes/v34/NA-34 [copyright notice]: This work is copyrighted by The Association for Consumer Research. For permission to copy or use this work in whole or in part, please contact the Copyright Clearance Center at http://www.copyright.com/. / WORKING PAPERS about buying a new car, or to mentally contrast both. They were then presented with an advertisement that offered excellent incentives for buying a new car (strong argument) or an advertisement that offered lackluster incentives for buying a new car (weak argument). We then administered a questionnaire about their expectations that buying a car was feasible and their attitudes toward buying a car in the near future. As predicted, participants in the mental contrast condition who received a strong advertisement demonstrated more positive attitudes and higher expectations of buying a desired new car than those who received a weak advertisement. Further, participants in the other two conditions did not differ in their expectations or attitudes, regardless of which persuasive advertisement they received. These findings indicate that FRT can be usefully applied to research in consumer behavior. References Fishbein, Martin and Icek Ajzen (1975) The Influence of Line and Surface Modifications in Product Design on Brand Recognition and Novelty Robert Kreuzbauer, University of Illinois at Urbana-Champaign, USA Jan Schoormans, Delft University of Technology, The Netherlands Dirk Snelders, Delft University of Technology, The Netherlands Extended Abstract The choice between novelty and familiarity when introducing a redesigned product is a crucial decision. How similar should the appearance of a redesigned product be compared to the old product to ensure brand familiarity? And, to what degree should the redesign look new in order to avoid boredom? A look into the processes of object perception reveals that novelty and similarity/familiarity are not two poles of the same dimension. Instead it is possible that consumers can perceive new products as both novel from and similar to a former product. According to the 4-stage model of object perception (cf. Palmer 1999; Palmer et al., 2003; Kreuzbauer & Malter 2006) a product which is perceived by a consumer passes 4 different stages until it becomes categorized within consumer memory. The first stage describes a 2-D retinal image which is a first impression of visual product stimuli that are projected to the viewpoint of the observer's eyes. A retinal image is perceived without the consumer's attention, and the information is unstructured and 'uninterpreted' (Julesz, 1984; Treisman, 1993). In the second stage, the 2-D retinal product impression is further processed, so that elements such as lines and edges of the stimulus are detected and "sharpened" (image-based stage). Further in the surface-based stage, general surface and spatial information is recovered. True 3-D processing first occurs in the final stage, called the object-based stage, since the product perception process does not end with the mere representation of all the visible lines and surfaces. Instead, it is assumed that during perception surface information is related to general stored knowledge about the intrinsic nature of the 3-D object (Biederman, 1987; Palmer, 1999). An example would be aspects of products that are occluded from the current viewpoint (e.g., the backs or undersides of a camera, TV, car, bottle, etc.). By simply perceiving the curved lines and surfaces of a bottle, the observer is able to make clear predictions regarding the probable appearance and properties of the back of the bottle. Therefore, hidden assumptions about the nature of the visual world are also required to enable the inclusion of information about unseen surfaces or parts of surfaces. Since line perception is an earlier process than other processes such as surface and texture perception, lines are the major visual elements that determine object recognition and similarity (cf. Biederman & Ju, 1992). Based on the ideas of Biederman & Ju, one can expect that products of a brand that share major line characteristics (e.g. the car grill or line-silhouette of the lights of a BMW car or its overall silhouette) should be considered as more similar (i.e. stronger brand familiarity) than products that share similar colors, textures or other surface elements but have different line-structure. When companies introduce redesigned products, consumers are confronted with differences between the lines and surfaces of the old and redesigned product. These modifications are hypothesized to influence both the perception of product novelty and brand recognition in the following ways: H1: Line modification has a strong (-) negative effect on brand recognition. Surface modification has a small (-) negative effect on brand recognition. H2: Line modification has a strong (++) positive effect on novelty. Surface modification has a strong (+) positive effect on novelty. Advances in Consumer Research (Volume 34) / 441 To test our hypotheses, we redesigned the appearance of a Nokia phone. The 2-D stimuli were designed by a professional designer and differed on the degree of line and surface modifications. Stimuli were black and white sketches, no brand name was included. Our benchmark stimulus was a sketch of the most sold Nokia cell phone among our respondents. In study 1(N=17), we assessed perceived line and surface changes to check our manipulations. Experts (Bachelor in design) compared 6 stimuli with the benchmark. Our stimuli indeed differed in line and surface modifications. Next to assess brand recognition, we asked the same respondents to indicate the brand of the stimuli and their degree of certainty on this. To test hypothesis 1, we correlated the perceived line and perceived surface modifications with brand recognition. Analyses showed a significant negative effect of both line (Pearson R=.47 In a second study (N=17), we tested hypothesis 1 and 2. We asked respondents to compare our stimuli (differences in degree of line and surface change based on study 1) with our benchmark stimulus on newness and aesthetic evaluation. Results in this study for hypothesis 1 are comparable to those in study 1. Hypothesis 2 was tested with the use of partial correlations because of high correlation between surface and line change. Partial correlations showed that controlled for surface changes [line changes] the correlation was significant (Pearson R=.26; P<.001) [correlation was insignificant (Pearson R=.10; P=.32)]. This partly confirms our hypothesis 2. As a next step we will make experiments with a bigger sample and with different products. In addition to that we will measure the interaction between line and surface changes on brand recognition and novelty as well as overall preference. The results will be presented at the conference. The contribution of this research to consumer science is two fold: Firstly, it shows how different types of visual characteristics (line and surface) affect brand recognition, novelty and preference. Secondly, it provides an in-depth understanding of processes of product perception and should motivate further research into that direction. Whereas consumer information processing has mostly concentrated on the part of categorization and knowledge representation, this research focuses on the mostly overlooked part of (product) perception. References Heuristic and Systematic Information Processing when Valuating Multiple Gains and Losses Dorothea Schaffner, New York University, USA Andreas Herrmann, University of St.Gallen, Switzerland Extended Abstract This research attempts to enhance our understanding of people's preferences for separating or combining gains and losses. According to the normative decision theory of rational choice, people should demonstrate indifference towards the combination or separation of negative and positive events (Thaler, 1985). However, there are many examples and empirical studies demonstrating that preferences systematically violate normative decision theory (Kahneman & Tversky, 1979, 1984. E.g. winning $90 all at once is not perceived as being equal to winning$40 and 50 separately. Inspired by Kahneman and Tversky's Prospect Theory (1979) a substantial body of literature has investigated the patterns of preference formation when judging consolidated versus segregated gains and losses. Thaler's hedonic editing rules are based on the value function of the prospect theory and predict a preference for consolidating multiple losses and integrating multiple gains; empirical research confirmed these predictions (Thaler, 1985). Later studies confirmed the preference for segregating gains but stated-contrary to theory-a preference for segregating losses also (Linville & Fischer, 1991; Thaler & Johnson, 1990). Explanations for these findings refer to the theory of renewable resources (Linville & Fischer, 1991) or to the quasi hedonic-editing hypothesis (Thaler & Johnson, 1990). However, this previous research focuses on the emotional impact of segregated versus integrated gains and losses and the role of motivational underpinnings of preference formation for multiple gains and losses remain unclear. Based on the heuristic-systematic model (HSM) of human information processing (Chaiken, 1987) this research attempts to shed light on the underlying logic of judgment of multiple gains and losses. The HSM differentiates systematic from heuristic information processing. Whereas heuristic processing is characterized by a relatively effortless application of simple decision rules, systematic processing is marked by a more cognitively demanding comprehensive analysis of judgment-relevant information. Which mode of information processing predominates depends on the individual's current motivation (Chen, Shechter, & Chaiken, 1996). It is stated that accuracy motivation will enhance systematic processing (Chaiken & Maheswaran, 1994). Numerous studies have demonstrated the differential influence of the two modes of information processing (heuristic and systematic) on judgment and decision making: Hsee and / WORKING PAPERS Rottenstreich's (Hsee & Rottenstreich, 2004) experiments demonstrate the influence of the two modes of information processing on valuation and subsequently on preferences for segregation and integration of gains and losses. Additionally, research by Agrawal and Maheswaran (Agrawal & Maheswaran, 2005) lends support to the assumption that accuracy motivation eliminates outcome-biased judgments. Based on the previous research on dual process models and valuation we predict that accuracy motivation will foster systematic information processing and will therefore take a substantial impact on how segregated versus integrated gains and losses are perceived and valuated. To test the predictions an experimental study was conducted. 160 undergraduate students completed the study for a payment of 5. Participants were randomly assigned to one of four groups. They were primed either to be accuracy motivated or to valuate by feelings and assigned to either a gain or a loss scenario. They were presented both an integrated and a segregated scenario and indicated their preference for one of the scenarios. In general, the current research establishes that accuracy motivation strongly influences or even reverses preferences when people valuate segregated versus integrated gains. However, the results obtained by this research raise interesting issues on how the type of event (gain versus loss) elicits different valuations of multiple events. We assume that loss aversion and specific emotions related to losses influence the way outcomes are valuated. Therefore, further work is needed to scrutinize the effects of emotions in the context of the valuation of segregated versus integrated losses. On the Importance of Non-dominant Cultural Dimensions: Effects of Vertical Individualism on Consumer Behaviour in Norway Alexander Jakubanecs, Norwegian School of Economics and Business Administration, Norway Magne Supphellen, Norwegian School of Economics and Business Administration, Norway Introduction Countries and cultures are typically characterised in terms of some dominant cultural variables. For example, the US is described as a vertical individualistic country, whereas Japan is vertical and collectivistic (Triandis 1995). Scandinavian countries are typically found to score high on horizontal dimensions (Nelson and Shavitt 2002; Silvera and Seger 2004). In this paper we promote the point that nondominant cultural dimensions may play a more important role in explaining culturally related consumer behaviors than dominant dimensions. Individualism-collectivism (INDCOL) The original typology was later expanded with a new dimension of vertical vs. horizontal INDCOL (Singelis et al. 1995; Triandis and Gelfand 1998). Vertical dimension of INDCOL captures the degree of status and inequality present in this orientation whereas horizontal dimension captures the degree of egalitarianism (Singelis et al. 1995; Triandis and Gelfand 1998). Intracultural variation in INDCOL is conceptualised as idiocentric vs. allocentric tendencies (Triandis et al. 1985). Effects of vertical and horizontal INDCOL Vertical individualist subjects preferred domestic products only when they were perceived as superior, whereas vertical collectivist subjects were found to prefer domestic products regardless of product superiority (Gurhan-Canli and Maheswaran 2000). When individuals with independent self-construal where presented with promotion focused appeals, i.e. emphasizing gains, hopes and aspirations, the messages were more persuasive than when they were presented with prevention focused appeals, i.e. emphasizing avoidance of losses, duties and obligations (Aaker and Lee 2001). The reverse was true for individuals with interdependent self-constructs. There is also evidence that these effects may hold only for vertical cultures. Advances in Consumer Research (Volume 34) / 443 The Norwegian culture The Norwegian culture has been characterized as horizontal rather than vertical (Nelson and Shavitt 2002; Silvera and Seger 2004). The literature points to the predominance of the horizontal value orientations in the Norwegian culture so the researchers tended to use these to explain consumer behavior. However as we argue further and as our data shows other non-dominant dimensions may account for important differences in consumer behavior. Cultural Embeddedness of Products (CEP) The concept of CEP is defined as the degree of the various types of national cultural meanings that are transferred from the culturally constituted world (McCracken 1986) Hypotheses formulation Intracultural variation becomes an important factor when non-dominant dimensions are likely to account for important consumer behavior. The case is illustrated by the Norwegian example. The horizontal dimensions of INDCOL do not focus on hierarchies or status, which are important in the concept of CEP. Consequently we do not expect these dominant cultural orientations to have effect on this consumer behavior variable. Vertical individualists are likely to engage in national identity construction in order to enhance their status, provided that having strong national identity has a positive connotation. Being a good citizen is valued in the Norwegian culture. Based on this discussion we formulate the following hypothesis: H1: Vertical individualism has a strong positive effect on CEP (Cultural Embeddedness of Products) even in countries where vertical individualism is a non-dominant dimension (e.g., Scandinavia). Methodology The hypothesis was tested on a non-student sample from Norway (N=158). Vertical-horizontal INDCOL construct was measured by a 16-item, 7-point Likert scale (Singelis et al. 1995). The survey included 8 product categories: ketchup, bunad (a Norwegian national costume), cars, meat cakes (a national meat dish), make-up, goat cheese, pizza, cross-country skis. The concept of CEP was measured by a 22-item, 7-point Likert Cultural Embeddedness of Products (CEP) scale (Jakubanecs and Supphellen 2004; Jakubanecs and Supphellen 2005). The CEP Scale items included such as: "If I traveled abroad, and was asked about a typical Norwegian product, I could mention this one", "When I was a child my family referred to this product as one of the symbols of our Norwegian identity", "If other Norwegian were to see me using this product, he or she would perceive me as a typical Norwegian". Results Consistent with earlier studies, horizontal collectivism is the most dominant dimension in the Norwegian culture followed by vertical collectivism. Norwegians are also high on horizontal individualism and as expected rather low on vertical individualism. EFA of CEP Scale resulted in the three-dimensional structure (Tradition, Identity-building and Relationship CEP) for the eight product categories. The data was subjected to path analysis via LISREL (Jøreskog and Sørbom 1993). Some of the LISREL model fit indices were: for ketchup-chi-square/df=2.895, GFI=.981, CFI=.974, RMSEA=.110; for pizza-chi-square/df=2.122, GFI=.983, CFI=.979, RMSEA=.085. The results strongly support H1. Vertical individualism has strong effects on the Tradition CEP (e.g. .359*** for meat cakes, .239*** for cars; ***=p< .01), Identity-building CEP (e.g. .510*** for meat cakes, .335*** for ketchup) for most product categories, whereas very few effects are observed for the other INDCOL dimensions. Discussion The most dominant cultural orientation of the Norwegian society-horizontal collectivism has little explanatory power when it comes to perception and construction of the national identity. The same conclusion applies to the other dominant dimension-horizontal individualism. Instead the dimension of vertical individualism, existence of which previously was ignored in the studies of the Norwegian culture, provides consistent explanations in this behavior cluster across the product categories. It could be the case that in the Norwegian culture, the national cultural meanings could serve status-enhancing purpose of being a good citizen which is important to vertical individualists. Implications We find support for importance of recognising and measuring allocentric and idiocentric tendencies when conducting cross-cultural consumer behavior studies. Reliance on nation-level studies and ignorance of the intracultural variation may weaken research validity. Flip-Flopping of General Action and Inaction States: A Study on the Mental Representation of Action and Inaction Goals Kathleen C. McCulloch, University of Florida, USA Kenji Knoguchi, University of Florida, USA Dolores Albarracin, University of Florida, USA Extended Abstract Being active or inactive is essential to human life. People, cultures, and eras appear to vary in requisite levels of energy and productivity. Thus, we examined the possibility that general tendencies to engage in or abstain from behavior irrespective of the domain (e.g., buying, using drugs, exercising) can be due to the setting of general action and inaction goals. We have investigated general action goals that reside at the meta-level of goal systems (for goal-facilitation of specific behaviors, see Research by Albarracin and her colleagues (see Albaracin, in press) have shown that people with general action goals preferred actionoriented tasks, identified more behaviors, performed better on a text comprehension task, and formed attitudes on a novel topic more than people with inaction goals. Given these differences in performance across these domains, we wanted to further explore these goals at the level of mental representations. In this study, we explored the activation of the action/inaction goals via a priming task with icons related to action and inaction and in turn, identified the conditions that led to the satisfaction of those goals. Our basic hypothesis is that the action goal is "turned off" via satisfaction of that goal and as a result, the inaction goal is "turned on." Thus, the purposes of this study were 1) to identify if general action and inaction goals are mentally represented and 2) to examine the "on and off" manner of action and inaction goals. In the first part of study, half of the participants were exposed to the action primes while the rest were exposed to the inaction primes. To prime action goals, black and white icons concerning specific actions (e.g., running, throwing, and dancing) were employed. To prime inaction goals, black and white icons concerning specific inactions (e.g., lying down, meditating, and relaxing) were used. Participants in the action prime condition were exposed to 10 pictures related to actions and 14 pictures neutral to action. Those in the inaction prime condition were exposed to 10 pictures related to inaction and 14 pictures neutral