Consumers and Experts: An Econometric Analysis of the Demand for Water Heaters

Consumers can accumulate product information on the basis of a combination of searching, product advertising and expert advice.Examples of experts who provide product information include doctors advising patients on treatments, motor mechanics diagnosing car problems and recommending repairs, accountants recommending investment strategies, and plumbers making recommendations on alternative water heaters.In each of these examples, the transactions involve the sale of goods and services where the seller is at the same time an expert providing advice on the amount and type of product or service to be purchased.In the case of water heaters, the plumber advising a consumer on their choice of water heater will most likely also install the appliance.Because of the information asymmetry there is potentially a strategic element in the transmission of information from expert to consumer.This paper reports on an econometric investigation of the factors that determine the choices made by consumers and the recommendations made by plumbers and the extent to which plumbers act in the best interests of their customers.The empirical work is made possible by the availability of stated preference data generated by designed experiments involving separate samples of Australian consumers and plumbers.We find some evidence that plumbers have higher preferences than consumers for heater characteristics that increase their profit margin.consumers;demand;product information;advertising;investment;econometrics

Bounds on Quantiles in the Presence of Full and Partial Item Nonresponse

Microeconomic surveys are usually subject to the problem of item nonresponse, typically associated with variables like income and wealth, where confidentiality and/or lack of accurate information can affect the response behavior of the individual. Follow up categorical questions can reduce item nonresponse and provide additional partial information on the missing value, hence improving the quality of the data. In this paper we allow item nonresponse to be non-random and extend Manski’s approach of estimating bounds to identify an upper and lower limit for the parameter of interest (the distribution function or its quantiles). Our extension consists of deriving bounding intervals taking into account all three types of response behavior: full response, partial (categorical) response and full nonresponse. We illustrate the theory by estimating bounds for the quantiles of the distribution of amounts held in savings accounts. We consider worst case bounds which cannot be improved upon without additional assumptions, as well as bounds that follow from different assumptions of monotonicity.item nonresponse;bracket response;bounds and identification

Nonparametric Bounds in the Presence of Item Nonresponse, Unfolding Brackets and Anchoring

Household surveys often suffer from nonresponse on variables such as income, savings or wealth.Recent work by Manski shows how bounds on conditional quantiles of the variable of interest can be derived, allowing for any type of nonrandom item nonresponse.The width between these bounds can be reduced using follow up questions in the form of unfolding brackets for initial item nonrespondents.Recent evidence, however, suggests that such a design is vulnerable to anchoring effects.In this paper Manski's bounds are extended to incorporate the information provided by the bracket respondents allowing for different forms of anchoring.The new bounds are applied to earnings in the 1996 wave of the Health and Retirement Survey.The results show that the categorical questions can be useful to increase precision of the bounds, even if anchoring is allowed for.microeconomics;nonresponse

The Puzzle of Muslim Advantage in Child Survival in India

The socio-economic status of Indian Muslims is, on average, considerably lower than that of upper caste Hindus. Muslims have higher fertility and shorter birth spacing and are a minority group that, it has been argued, have poorer access to public goods. They nevertheless exhibit substantially higher child survival rates, and have done for decades. This paper documents and analyses this seeming puzzle. The religion gap in survival is much larger than the gender gap but, in contrast to the gender gap, it has not received much political or academic attention. A decomposition of the survival differential reveals that some compositional effects favour Muslims but that, overall, differences in characteristics between the communities and especially the Muslim deficit in parental education predict a Hindu advantage. Alternative outcomes and specifications support our finding of a Muslim fixed effect that favours survival. The results of this study contribute to a recent literature that debates the importance of socioeconomic status (SES) in determining health and survival. They augment a growing literature on the role of religion or culture as encapsulating important unobservable behaviours or endowments that influence health, indeed, enough to reverse the SES gradient that is commonly observed.religion, caste, gender, child survival, anthropometrics, Hindu, Muslim, India

Nonparametric Modeling of the Anchoring Effect in an Unfolding Bracket Design

Household surveys are often plagued by item non-response on economic variables of interest like income, savings or the amount of wealth. Manski (1989,1994, 1995) shows how, in the presence of such non-response, bounds on conditional quantiles of the variable of interest can be derived, allowing for any type of non-random response behavior. Including follow up categorical questions in the form of unfolding brackets for initial item non-respondents, is an effective way to reduce complete item non-response. Recent evidence, however, suggests that such design is vulnerable to a psychometric bias known as the anchoring effect. In this paper, we extend the approach by Manski to take account of the information provided by the bracket respondents. We derive bounds which do and do not allow for the anchoring effect. These bounds are applied to earnings in the 1996 wave of the Health and Retirement Survey (HRS). The results show that the categorical questions can be useful to increase precision of the bounds, even if anchoring is allowed for.unfolding bracket design;anchoring effect;item nonresponse;bounding intervals;nonparametrics

Nonparametric Bounds on the Income Distribution in the Presence of Item Nonresponse

Item nonresponse in micro surveys can lead to biased estimates of the parameters of interest if such nonresponse is nonrandom. Selection models can be used to correct for this, but parametric and semiparametric selection models require additional assumptions. Manski has recently developed a new approach, showing that, without additional assumptions, the parameters of interest are identified up to some bounding interval. In this paper, we apply Manski’s approach to estimate the distribution function and quantiles of personal income, conditional on given covariates, taking account of item nonresponse on income. Nonparametric techniques are used to estimate the bounding intervals. We consider worst case bounds, as well as bounds which are valid under nonparametric assumptions on monotonicity or under exclusion restrictions.nonparametrics;bounds and identification;sample non-response

Migration Governance in Countries of Transit: Assessing Policy Implications in Algeria

Located between sub-Saharan Africa and southern Europe on the edge of the Mediterranean the country of Algeria has experienced the challenges of a transit state in attempting to prevent irregular migration through its territory. The question guiding this research aimed to explore the conditions under which and with what regard to sovereignty do countries that experience extensive through-migration adopt global governance norms and implement policies which contribute to the broader international goals of safe, orderly and regular migration. This research project examines findings from an expert survey which indicate that, despite a strong sovereignty ethic, Algeria approaches irregular migration governance from a domestic security angle with a priority on maintaining public order and satisfaction. Furthermore, findings from a policy assessment based on the International Organization for Migration (IOM) Migration Governance Framework (MiGOF) revealed the causes for such an approach to be based more a lack of internal consistency rather than deliberate sovereignty assertion in response to external pressure

Een kijkje in de technische keuken van het Restaurant van de Toekomst

De schatkist van een onderzoeksfaciliteit als het Restaurant van de Toekomst is gevuld met data. Het is dan ook erg belangrijk om het datamanagement goed op orde te hebben. Hoe zorg je ervoor dat je de verzamelde gegevens goed opslaat en hoe kun je optimaal gebruik maken van deze gegevens? Deze vragen vormen de basis voor het werk dat door de Inteligent Systems groep van Food & Biobased Research (onderdeel van Wageningen UR) wordt uitgevoerd. Voor het Restaurant van de Toekomst hebben we de data-infrastructuur opgezet

Nonparametric Modeling of the Anchoring Effect in an Unfolding Bracket Design

Household surveys are often plagued by item non-response on economic variables of interest like income, savings or the amount of wealth. Manski (1989,1994, 1995) shows how, in the presence of such non-response, bounds on conditional quantiles of the variable of interest can be derived, allowing for any type of non-random response behavior. Including follow up categorical questions in the form of unfolding brackets for initial item non-respondents, is an effective way to reduce complete item non-response. Recent evidence, however, suggests that such design is vulnerable to a psychometric bias known as the anchoring effect. In this paper, we extend the approach by Manski to take account of the information provided by the bracket respondents. We derive bounds which do and do not allow for the anchoring effect. These bounds are applied to earnings in the 1996 wave of the Health and Retirement Survey (HRS). The results show that the categorical questions can be useful to increase precision of the bounds, even if anchoring is allowed for.