Minnesota Agricultural Economist 688

Industrial Organization, Marketing,

ADOPTION OF ECR PRACTICES IN MINNESOTA GROCERY STORES

Efficient Consumer Response (ECR) is an industry-wide, collaborative initiative to re-engineer the grocery supply chain. This report presents findings from a study of ECR adoption in Minnesota grocery stores. Data were collected through interviews with managers of forty stores that are broadly distributed over store sizes, locations, and organizational forms. The interviews focused on business practices and technologies related to inventory management and ordering, shelf-space allocation and product assortment decisions, and product pricing and promotions. Findings are presented from three distinct perspectives: (1) stores grouped by location (metro and out- state), (2) stores grouped by organizational form (corporate chain, independent chain, and single store), and (3) stores grouped by levels of an ECR "readiness index" that indicates the level of adoption for key business practices and technologies that support ECR initiatives. The following general conclusions can be drawn from the detailed results presented in this report. 1. Location in the Twin Cities metropolitan area makes an important difference in implementing some components of the ECR initiative. On average, metro and out-state stores differ little with respect to store size or the adoption of technologies that support ECR. Metro stores are much more likely than out-state stores, however, to coordinate shelf space and product assortment decisions and pricing and promotion activities with outside trading partners. 2. On average, stores that are part of a chain, especially a large corporate chain, are making faster progress toward implementation of ECR initiatives than are single stores. However, three independently owned single stores were also among the most innovative of those we visited. In these stores, it appears that a visionary, energetic owner/manager is able to quickly respond to new opportunities. 3. ECR adoption and superior performance are closely associated. Stores with a high ECR "readiness index" have much higher sales per labor hour, sales per square foot, and annual inventory turns. We cannot determine whether ECR readiness leads to better performance or better performance makes it easier to adopt business practices and technologies that support ECR. We can conclude, however, that competitive forces will almost certainly drive more stores toward adoption of a wider range of technologies and business practices that support the ECR initiative. In summary, ECR is changing the way Minnesota grocers do business, and adopting ECR practices goes hand-in-hand with better financial performance. Findings from this study suggest that stores of any size and organizational form that are willing and able to adopt new technologies, to develop cooperative relationships with their trading partners, and to respond to the unique needs of their customers will increase their chance of success in this competitive market.Agribusiness, Industrial Organization, Land Economics/Use,

CHANGES IN RETAIL FOOD DELIVERY: SIGNALS FOR PRODUCERS, PROCESSORS AND DISTRIBUTORS

This paper contains two chapters related to changes in retail food delivery and sales. The first discusses trends in consumer demographics and lifestyles and how these continue to drive changes in the way food is prepared and delivered to consumers. Retail stores are responding with new formats: providing more ready to eat foods; more convenient store layouts; lower prices and better service in niche markets across the country. Their demands send signals up the food chain to processors and producers that alter their production and inventory decisions. Electronic information technology speeds these changes and leads to more efficient operation with, allegedly, better service for consumers. The second chapter discusses how advances in information technology affect not only the internal business operations in food firms throughout the food supply chain but also how the product flows and how businesses link their processes together. The reengineering of the food supply chain by way of an industry-wide initiative called "efficient consumer response" (ECR) is explained and analyzed for its motivations and implementation, thus far. The many facets of ECR such as product replenishment and promotion are discussed. Lessons learned from ECR include that it is possible to accommodate the coexistence of firms of various sizes and types, and that the role of trade associations in facilitating industry-wide changes is vital and impressive.Agribusiness, Industrial Organization,

Interrogating informality: Conceptualisations, practices and policies in the light of the New Urban Agenda

Informality is growing in a context of increasing inequity, and in many places becoming the norm. However, despite decades of studies and interventions, ‘recognising informality’ is still a key issue. This paper provides a review of the literature on informality showing the shifts in its conceptualisations. The paper firstly discusses conceptual approaches related to the term ‘informality’ in the context of urban development; it then examines practices within, and related to, informality; and it concludes with an appraisal of policy approaches and their impact as reported in the literature. The paper finds a wide range of conceptualisations, including the questioning of the usefulness and appropriateness of the term. It finds reported evidence of ‘informality’ (as understood to date) spreading to the middle classes, and increasingly emerging in the Global North. Policies seem to be lagging behind in how they engage with so-called informality, with little acknowledgement of theory and limited understanding of their impacts on ‘informal’ practices. Finally, the paper identifies the need for better understanding of governance frameworks that include the range of actors that would normally be associated with so-called ‘informality’

Límites de la regulación: competencia y oportunismo

En las páginas que siguen el lector tendrá acceso a un análisis profundo de dos límites a ser tomados en cuenta al momento de propugnar modificaciones en las reglas de regulación y las funciones de los organismos reguladores: la competencia y el oportunismo.Ambos factores son piezas claves para determinar el grado de eficiencia de los cambios propuestos y así evaluar su capacidad de generar bienestar social ysalvaguardar el interés público, a través de decisiones equilibradas que no afecten significativamente a los consumidores ni a las empresas involucradas

The Politics of Honduras Water Institutional Reform

The water and sanitation sector has been in the eye of the storm when referring to institutional reforms in Latin America. Concepts and methodologies have been imported from western countries and these have required adjustments of existing policies and the creation of a regulatory framework. Have these adjustments resulted in delivering an efficient implementation? What is the degree of dependence to the top-down approach, when the implementation stage comes into place?This study focuses first on understanding institutional and organisational structure in the Honduran water sector from 1990-2002. Second, the study analyses the changes generated by the institutional reform and evaluates the policy implementation of the institutional reform and their linkage with past performances and the traditional organisational structure from 2003-2006. Third, three exploratory case studies are presented as the outcomes of these institutional and organisational changes.Finally, the controversies of the institutional change are presented as dilemmas. They exposed the strengths, weaknesses and potentiality of the Water Institutional Reform (WIR). The result of the analysis is presented in the conclusions and indicates the weaknesses carried out from the traditional institutional and organisational water sector system. It proves as well that it is not only the rules that constraint the WIR process but the lack of creativity and incentives that individuals in charge -new administrators-, and not only the administration, thrust into the process.QC 2010090

Policy Design from a Network Perspective: Targeting a Sector, Cascade of Links, Network Resilience

Drawing on input-output data, a computational methodology is proposed to: (i) characterize the upstream and/or downstream network of a targeted (or prioritized) sector i, (ii) uncover the cascade of layers of links in the network constructed, and (iii) measure the degree of network resilience using edge betweenness centrality measure of edges between communities. These objectives are accomplished through three complementary algorithms. The implementation of the algorithms is illustrated using Turkiye’s 2018 input-output production network. Ways to design policies are discussed from a network perspective. The key findings are three-fold. First, in network-based policy design, it is highly critical to consider the interdependencies of regulated and seemingly competitive sectors. Efficiencies gained in liberalized markets via pro-competitive PMR can easily be wasted before final consumers benefit from them as regulated industries may exercise their market power to confiscate part of the efficiency gain created in competitive markets. Improved competition in a single market may not generate the desired outcome even if competition policies perfectly support that market because benefits from competition may not spread over the rest of the network due to disruptions in the cascade of interdependencies concerned. Second, a network-based policy design should start with the identification of the “dominant” source and the “subordinate” sink sector(s), and those in between. The source−sink structure of Turkiye’s manufacturing network illustrates that the manufacturing sector is the most dominant, whereas telecommunications and transport, energy and construction sectors are the potential sinks where large chunk of input flow ends up. Agriculture, finance and oil extraction-mining seem to be interactive sectors. Third, the cascade of three layers of links are identified, and the upstream network of the manufacturing sector is found to have a mediocre level of resilience against the complete disruption of the intermediate layer of the network

Policy Design from a Network Perspective: Targeting a Sector, Cascade of Links, Network Resilience

Drawing on input-output data, a computational methodology is proposed to: (i) characterize the upstream and/or downstream network of a targeted (or prioritized) sector i, (ii) uncover the cascade of layers of links in the network constructed, and (iii) measure the degree of network resilience using edge betweenness centrality measure of edges between communities. These objectives are accomplished through three complementary algorithms. The implementation of the algorithms is illustrated using Turkiye’s 2018 input-output production network. Ways to design policies are discussed from a network perspective. The key findings are three-fold. First, in network-based policy design, it is highly critical to consider the interdependencies of regulated and seemingly competitive sectors. Efficiencies gained in liberalized markets via pro-competitive PMR can easily be wasted before final consumers benefit from them as regulated industries may exercise their market power to confiscate part of the efficiency gain created in competitive markets. Improved competition in a single market may not generate the desired outcome even if competition policies perfectly support that market because benefits from competition may not spread over the rest of the network due to disruptions in the cascade of interdependencies concerned. Second, a network-based policy design should start with the identification of the “dominant” source and the “subordinate” sink sector(s), and those in between. The source−sink structure of Turkiye’s manufacturing network illustrates that the manufacturing sector is the most dominant, whereas telecommunications and transport, energy and construction sectors are the potential sinks where large chunk of input flow ends up. Agriculture, finance and oil extraction-mining seem to be interactive sectors. Third, the cascade of three layers of links are identified, and the upstream network of the manufacturing sector is found to have a mediocre level of resilience against the complete disruption of the intermediate layer of the network

Policy Design from a Network Perspective: Targeting a Sector, Cascade of Links, Network Resilience

Drawing on input-output data, a computational methodology is proposed to: (i) characterize the upstream and/or downstream network of a targeted (or prioritized) sector i, (ii) uncover the cascade of layers of links in the network constructed, and (iii) measure the degree of network resilience using edge betweenness centrality measure of edges between communities. These objectives are accomplished through three complementary algorithms. The implementation of the algorithms is illustrated using Turkiye’s 2018 input-output production network. Ways to design policies are discussed from a network perspective. The key findings are three-fold. First, in network-based policy design, it is highly critical to consider the interdependencies of regulated and seemingly competitive sectors. Efficiencies gained in liberalized markets via pro-competitive PMR can easily be wasted before final consumers benefit from them as regulated industries may exercise their market power to confiscate part of the efficiency gain created in competitive markets. Improved competition in a single market may not generate the desired outcome even if competition policies perfectly support that market because benefits from competition may not spread over the rest of the network due to disruptions in the cascade of interdependencies concerned. Second, a network-based policy design should start with the identification of the “dominant” source and the “subordinate” sink sector(s), and those in between. The source−sink structure of Turkiye’s manufacturing network illustrates that the manufacturing sector is the most dominant, whereas telecommunications and transport, energy and construction sectors are the potential sinks where large chunk of input flow ends up. Agriculture, finance and oil extraction-mining seem to be interactive sectors. Third, the cascade of three layers of links are identified, and the upstream network of the manufacturing sector is found to have a mediocre level of resilience against the complete disruption of the intermediate layer of the network

Policy Design from a Network Perspective: Targeting a Sector, Cascade of Links, Network Resilience

A computational methodology is proposed to: (i) characterize the upstream and/or downstream network of a targeted sector i, (ii) uncover the cascade of layers of links in the network, and (iii) measure the degree of network resilience. The methodology is implemented using Turkiye's 2018 input-output data to characterize the gaps and the type of policy reforms required to address them in the context of the targeted manufacturing sector. Market and competition policy reforms are discussed from a network perspective in such a way as to enhance the productivity of the manufacturing sector. Three findings are noteworthy. First, production activities of the manufacturing sector have strong links with regulated general purpose service sectors, including financial, energy-water-gas, and transport and ICT. Therefore, improved competition in the manufacturing sector will not necessarily increase its productivity even if competition policies perfectly support the market for manufacturing products. Second, the source-sink structure of Turkiye's manufacturing network illustrates that the manufacturing sector is the most dominant, whereas transport-ICT, energy-water-gas, and construction sectors are the potential sinks where large chunk of input flow ends up. Third, the cascade of three layers of links suggests that the upstream network of the manufacturing sector has a moderate level of resilience against the complete disruption of the intermediate layer