Walk or wait?: An empirical analysis of street crossing decisions

We examine the behaviour of pedestrians wishing to cross a stream of trasffic at signalized intersections. We model each padestrian as making a desccrete crossing choice by comparing the gaps between vehicles in traffic to an individual-specific "critical gap" that characterizes the individual's minimal acceptable gap. We propose both parametric and nonparametric approaches to estimate the distribution of critical gaps in the population of pedestrians. To estimate the model, we gather field data on crossing decisions and vehicle flows at three intersections in New Delhi. The estimates provide information about heterogeneity in critical gaps across pedestrians and intersections and permits simulation of the effect of changes in traffic light sequence (flows)on pedestran crossing behavior and waiting times.

How Sales Taxes Affect Customer and Firm Behavior: The Role of Search on the Internet

When a multichannel retailer opens its first retail store in a state, the firm is obligated to collect sales taxes on all Internet and catalog orders shipped to that state. This article assesses how opening a store affects Internet and catalog demand. The authors analyze purchase behavior among customers who live far from the retail store but must now pay sales taxes on catalog and Internet purchases. A comparable group of customers in a neighboring state serves as a control. The results show that Internet sales decrease significantly, but catalog sales are unaffected. Further investigation indicates that the difference in these outcomes is partly attributable to the ease with which customers can search for lower prices at competing retailers. The authors extend the analysis to a panel of multichannel firms and show that retailers that earn a large proportion of their revenue from direct channels avoid opening a first store in high-tax states. They conclude that current U.S. sales taxes laws have significant effects on both customer and firm behavior

Predicting the impact of upstream mergers on downstream markets with an application to the retail gasoline industry

This paper presents an empirical model of oligopolistic supply and demand that reflects divisions between downstream retailers and upstream suppliers in order to evaluate the potential effects of upstream mergers. The demand model allows for downstream product differentiation, while the supply model allows upstream firms to inherit market power from their affiliated retailers. The supply and demand models are jointly estimated using data on the retail gasoline industry for the Hawaiian islands in the 1990s. A number of hypothetical upstream mergers in the Hawaiian retail gasoline industry are simulated to evaluate the effects of the mergers on market outcomes and welfare. Various scenarios with post-merger cost savings are also considered.Upstream and downstream competition Merger analysis Differentiated products oligopoly Retail gasoline industry Petroleum industry

PRICES AND ENDOGENOUS MARKET STRUCTURE IN OFFICE SUPPLY SUPERSTORES -super-*

We consider the relationship between prices and market structure for office supply superstores in the U.S. which was central to the Federal Trade Commission's opposition to the merger of Staples and Office Depot. Due to potential biases in a standard regression, we employ a two-stage approach in which a model of endogenous market structure provides correction terms for a second stage price regression. Using a cross-section of data on market structures and Staples' prices, we find that excluding the correction term substantially distorts the importance of competitors as the two-stage model yields stronger negative relationships between prices and market structure variables. Copyright 2008 The Authors.

How Far for a Buck? Tax Differences and the Location of Retail Gasoline Activity in Southeast Chicagoland

We exploit variation in gasoline and cigarettes taxes in adjacent political jurisdictions for northern Illinois and Indiana to examine consumers' trade-off between prices and travel. We develop a model that relates activity in the retail gasoline industry around the tax borders to consumer locations. Our results indicate that the willingness of a typical Chicagoland consumer to travel an additional mile to buy gasoline corresponds to about $0.065 to$0.084 per gallon. According to our estimates, the observed area of Chicago, the jurisdiction with the highest taxes, is missing approximately 40% of the capacity that would exist were taxes equalized. Copyright by the President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Bank Profitability and Debit Card Interchange Regulation: Bank Responses to the Durbin Amendment ∗

and should not be interpreted as reflecting the official policy or position of the Department of Treasury, any agency of the U.S. Government, the Board of Governors of the Federal Reserve System, or anyone else associated with the Federal Reserve System

Interchange fees and payment card networks: economics, industry developments, and policy issues

In many countries around the world, electronic card-based payments have been replacing older types of payments at a rapid rate. In the United States, use of both debit cards and credit cards has been rising rapidly, while check volumes have been declining. The increased use of electronic payment methods has generated a number of public policy debates. One prominent debate concerns interchange fees. This paper is intended to provide background for understanding the interchange fee debate. The paper describes the operation of a typical payment card system, presents a summary of the economic theory underlying interchange fees, and discusses various developments in the U.S. payment cards industry, as well as legal and regulatory developments abroad. The paper concludes with a discussion and critical evaluation of a number of potential policy interventions.Electronic funds transfers ; Interchange fees (Banking) ; Credit cards