Competing Retailers and Inventory: An Empirical Investigation of General Motors\u27 Dealerships in Isolated U.S. Markets

We study the following question: How does competition influence the inventory holdings of General Motors’ dealerships operating in isolated U.S. markets? We wish to disentangle two mechanisms by which local competition influences a dealer’s inventory: (1) the entry or exit of a competitor can change a retailer’s demand (a sales effect); and (2) the entry or exit of a competitor can change the amount of buffer stock a retailer holds, which influences the probability that a consumer finds a desired product in stock (a service-level effect). Theory is clear on the sales effect—an increase in sales leads to an increase in inventory (albeit a less than proportional increase). However, theoretical models of inventory competition are ambiguous on the expected sign of the service-level effect. Via a Web crawler, we obtained data on inventory and sales for more than 200 dealerships over a six-month period. Using cross-sectional variation, we estimated the effect of the number and type of local competitors on inventory holdings. We used several instrumental variables to control for the endogeneity of market entry decisions. Our results suggest that the service-level effect is strong, nonlinear, and positive. Hence, we observe that dealers carry more inventory (controlling for sales) when they face additional competition

Drivers of Finished Goods Inventory in the U.S. Automobile Industry

Automobile manufacturers in the U.S. supply chain exhibit significant differences in their days of supply of finished vehicles (average inventory divided by average daily sales rate). For example, from 1995 to 2004, Toyota consistently carried approximately 30 fewer days of supply than General Motors. This suggests that Toyota’s well-documented advantage in manufacturing efficiency, product design, and upstream supply chain management extends to their finished-goods inventory in their downstream supply chain from their assembly plants to their dealerships. Our objective in this research is to measure for this industry the effect of several factors on inventory holdings. We find that two factors, the number of dealerships in a manufacturer’s distribution network and a manufacturer’s production flexibility, explain essentially all of the difference in finished-goods inventory between Toyota and three other manufacturers: Chrysler, Ford, and General Motors

Structural Estimation of the Newsvendor Model: An Application to Reserving Operating Room Time

The newsvendor model captures the trade-off faced by a decision maker that needs to place a firm bet prior to the occurrence of a random event. Previous research in operations management has mostly focused on deriving the decision that minimizes the expected mismatch costs. In contrast, we present two methods that estimate the unobservable cost parameters characterizing the mismatch cost function. We present a structural estimation framework that accounts for heterogeneity in the uncertainty faced by the newsvendor as well as in the cost parameters. We develop statistical methods that give consistent estimates of the model primitives, and derive their asymptotic distribution, which is useful to do hypothesis testing. We apply our econometric model to a hospital that balances the costs of reserving too much versus too little operating room capacity to cardiac surgery cases. Our results reveal that the hospital places more emphasis on the tangible costs of having idle capacity than on the costs of schedule overrun and long working hours for the staff. We also extend our structural models to incorporate external information on forecasting biases and mismatch costs reported by the medical literature. Our analysis suggests that overconfidence and incentive conflicts are important drivers of the frequency of schedule overruns observed in our sample

Does Adding Inventory Increase Sales? Evidence of a Scarcity Effect in U.S. Automobile Dealerships

What is the relationship between inventory and sales? Clearly, inventory could increase sales: expanding inventory creates more choice (options, colors, etc.) and might signal a popular/desirable product. Or, inventory might encourage a consumer to continue her search (e.g., on the theory that she can return if nothing better is found), thereby decreasing sales (a scarcity effect). We seek to identify these effects in U.S. automobile sales. Our primary research challenge is the endogenous relationship between inventory and sales — e.g., dealers influence their inventory in anticipation of demand. Hence, our estimation strategy relies on weather shocks at upstream production facilities to create exogenous variation in downstream dealership inventory. We find that the impact of adding a vehicle of a particular model to a dealer’s lot depends on which cars the dealer already has. If the added vehicle expands the available set of sub-models (e.g., adding a four-door among a set that is exclusively two-door), then sales increase. But if the added vehicle is of the same sub-model as an existing vehicle, then sales actually decrease. Hence, expanding variety across sub-models should be the first priority when adding inventory—adding inventory within a sub-model is actually detrimental. In fact, given how vehicles were allocated to dealerships in practice, we find that adding inventory actually lowered sales. However, our data indicate that there could be a substantial benefit from the implementation of a “maximizes variety, minimize duplication” allocation strategy: sales increase by 4.4 percent without changing the number of vehicles at each dealership, and a 5.2 percent is possible if inventory is allowed to decrease by 2.8 percent (and no more than 10 percent at any one dealer)

La ley de violencia en los recintos deportivos en el nuevo proceso penal chileno

80 p.La Ley de Violencia en los Recintos Deportivos, durante su corta vida en el mundo del derecho a tenido nula aplicación, es por eso que en el desarrollo de la monografía se tratará de dar una visión global de su reglamentación, de las falencias que ella contiene y las posibles modificaciones que ella debería someterse, para así darle una aplicación acorde al Nuevo Proceso Penal y así poder determinar si realmente cumple con los requisitos mínimos establecidos en el. Por ultimo, haré un desarrollo de todas las instituciones establecidas en el Nuevo Proceso Penal, para luego realizar las deducciones necesarias, para así concluir sobre su normativa, aplicación y posibles adecuaciones

Structural Estimation of the Effect of Out-of-Stocks

We develop a structural demand model that endogenously captures the effect of out-of-stocks on customer choice by simulating a time-varying set of available alternatives. Our estimation method uses store-level data on sales and partial information on product availability. Our model allows for flexible substitution patterns, which are based on utility maximization principles and can accommodate categorical and continuous product characteristics. The methodology can be applied to data from multiple markets and in categories with a relatively large number of alternatives, slow-moving products, and frequent out-of-stocks (unlike many existing approaches). In addition, we illustrate how the model can be used to assist the decisions of a store manager in two ways. First, we show how to quantify the lost sales induced by out-of-stock products. Second, we provide insights on the financial consequences of out-of-stocks and suggest price promotion policies that can be used to help mitigate their negative economic impact, which run counter to simple commonly used heuristics

Four wave mixing effects in gain-equalized distributed fiber raman amplifiers

The degradation of the performance of distributed fiber Raman amplifiers (DFRAs) is shown to be dependent on the interaction between pump-pump four-wave mixing (FWM) and stimulated Raman scattering (SRS), by means of numerical simulations. We verify that FWM processes, including depletion and parametric gain, generate new sources of SRS and a redistribution of the pump power along the fiber. Results show impairments on the performance of DFRAs such as loss of flatness on the spectral gain and reduction on the Raman gain and presence of FWM products within the transmission band

Redistribution of pump power and impairments in gain-equalized distributed fiber Raman amplifiers due to four-wave mixing and parametric amplification

In this work, by using a comprehensive numerical model which rigorously describes the interaction between stimulated Raman scattering (SRS) and four-wave mixing (FWM), we verify that FWM processes, including depletion and parametric gain, generate a redistribution of pump power in distributed fiber Raman amplifiers (DFRAs). As a consequence of pump–pump FWM, several FWM components can be generated, which act as new sources of SRS for Raman pumping. Due to new SRS–FWM interactions, a redistribution and exchange of pump power along the fiber also occurs, producing degradation in the performance of the amplifier. Numerical results show impairments in distributed amplified systems due to these interactions, such as loss of flatness on the spectral gain, reduction on the net Raman gain, and the presence of strong FWM products within the transmission band. We note that the localization of the zero dispersion wavelength (λZD) of the fiber is a critical factor in the occurrence of these impairments. A reduction of net Raman gain up to 3 dB and tilt up to 7 dB in the spectral gain profile have been found in different amplified systems as consequence of pump–pump FWM and parametric gain of Raman pumps