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...Vol. 27, No. 5, September–October 2008, pp. 811–828 issn 0732-2399 eissn 1526-548X 08 2705 0811 informs ® doi 10.1287/mksc.1080.0398 © 2008 INFORMS Supermarket Pricing Strategies Department of Economics, Duke University, Durham, North Carolina 27708, paul.ellickson@duke.edu William E. Simon School of Business Administration, University of Rochester, Rochester, New York 14627, misra@simon.rochester.edu Paul B. Ellickson Sanjog Misra M ost supermarket firms choose to position themselves by offering either everyday low prices (EDLP) across several items or offering temporary price reductions (promotions) on a limited range of items. While this choice has been addressed from a theoretical perspective in both the marketing and economic literature, relatively little is known about how these decisions are made in practice, especially within a competitive environment. This paper exploits a unique store level data set consisting of every supermarket operating in the United States in 1998. For each of these stores, we observe the pricing strategy the firm has chosen to follow, as reported by the firm itself. Using a system of simultaneous discrete choice models, we estimate each store’s choice of pricing strategy as a static discrete game of incomplete information. In contrast to the predictions of the theoretical literature, we find strong evidence that firms cluster by strategy by choosing actions that agree with those of its rivals. We also find a significant impact of...
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...the Candidate’s Thesis Advisor and has received approval. It was submitted to the Dean of the School of Engineering and the full Faculty, and was approved as partial fulfillment of the requirements for the degree of Master of Engineering. Dr. Eleanor Baum Dean, School of Engineering Dr. Fred L. Fontaine Candidate’s Thesis Advisor Acknowledgments I would like to thank my advisor, Dr. Fred Fontaine, for his guidance and patience throughout this process. Without his teachings I would not be where I am today. I would also like to thank the rest of the faculty, as well as my friends and peers at The Cooper Union Albert Nerken School of Engineering. A special thanks is due to David Nummey, Deian Stefan, Ashwin Kirpalani, Stefan M¨nzel and Matthew Epstein, all u of whom gave their time to listen patiently to my ideas and help me improve this thesis into what it is today. I would also like to thank Dr. Jack Lowenthal for keeping me motivated with his interest in my studies and projects. Lastly I like to thank my family, especially my parents, Dr. Richard and Shulamit Charles, my uncle Louis Charles, and my sister Aya for their constant support throughout my life. i Abstract Subband adaptive filters utilize subband decompositions to reduce the length of the adaptive filters, and thus reduce the number of computations needed to adapt for...
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...of output • The U.S. economy in the 1980s and 1990s • Anticipatory monetary policy • The policy mix during the German re-unification Changes from the Previous Edition: The material in this chapter has been updated, but its format is essentially the same. More emphasis is given to the economic expansion in the U.S. in the 1990s. Introduction to the Material: Chapter 11 uses the IS-LM model derived in Chapter 10 to show how monetary and fiscal policies can be used to dampen economic disturbances. The economic effects of various policy mixes are highlighted in discussions of actual events: the recession and recovery in the United States in the 1980s, the U.S. recession in 1990-91, the long economic expansion thereafter, and the policies enacted by Germany during the re-unification process in 1990-92. First, the Fed's conduct of monetary policy is discussed, with an explanation of how open market operations can be used to change nominal money supply. The effectiveness of monetary policy in changing the amount of output demanded depends on the steepness of the LM-curve. The transmission mechanism, that is, the process by which monetary policy changes affect the economy, occurs in several steps. First, a change in money supply leads portfolio holders to make adjustments in their asset holdings. As a result, asset prices and interest rates change. The change in interest rates subsequently affects intended spending and thus national income. Table 11-1 provides a...
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...Answers to Textbook Questions and Problems CHAPTER 1 The Science of Macroeconomics Questions for Review 1. Microeconomics is the study of how individual firms and households make decisions, and how they interact with one another. Microeconomic models of firms and households are based on principles of optimization—firms and households do the best they can given the constraints they face. For example, households choose which goods to purchase in order to maximize their utility, whereas firms decide how much to produce in order to maximize profits. In contrast, macroeconomics is the study of the economy as a whole; it focuses on issues such as how total output, total employment, and the overall price level are determined. These economy-wide variables are based on the interaction of many households and many firms; therefore, microeconomics forms the basis for macroeconomics. 2. Economists build models as a means of summarizing the relationships among economic variables. Models are useful because they abstract from the many details in the economy and allow one to focus on the most important economic connections. 3. A market-clearing model is one in which prices adjust to equilibrate supply and demand. Market-clearing models are useful in situations where prices are flexible. Yet in many situations, flexible prices may not be a realistic assumption. For example, labor contracts often set wages for up to three years. Or, firms such as magazine publishers change their prices...
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...Is-Lm, Aggregate Demand and Aggregate Supply Part (A) IS-LM, Aggregate Demand and Aggregate Supply Behavioral Equations, Identities, Equilibrium Conditions and List of Exogenous and Endogenous Variable The IS-LM Model is based upon six Behavioral equations, each describing the determinants of one of the macroeconomic variable considered by the model: 1. Consumption 2. Investment 3. Government spending 4. Tax revenue 5. Money demand 6. Money supply The description of the IS-LM model is completed by three key identities that are defining the links between aggregate demand, aggregate supply and the equilibrium level of income. Aggregate demand: Z = C=I=G --------------------------------1 Since firms produce as many goods and services as demanded in the economy, the aggregate supply is written as: Y=Z --------------------------------2 Combination of the equation 1 and 2 gives income identity for a closed economy Y = C + I + G. This states that in equilibrium aggregate income must be equal to aggregate demand. Exogenous variables: G: Government spending T: Tax on income M: Money supply P: Price level (fixed in the short-run) Endogenous variables: Y: Production C: Consumption I: Investments R: Interest rate Behavior Equations Y= C + I + G C= C0 + Cyd Yd –Cr r I= I0 + Ir r G= G TA = TA + Ty Y LM Behavior Equation L=M L=L0 + LyY – Lr r M=M0/P Production Function Y= Aƒ (K,N) Identities...
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...pressures on real world interest rates. These resulted from mercantilist trade policies and an unprecedented increase in savings and foreign reserves of emerging economies in Asia. This essay will first explain the Mundell-Fleming (henceforth M-F) model and use it to compare current account deficits under different exchange rate regimes. It will also refer to real-life contexts and discuss limitations of the model. The M-F model portrays the short-run Keynesian relationship between an economy’s key macroeconomic variables. The assumptions and implications of the model are as follows: 1. The economy operates on a perfectly elastic aggregate supply curve. This implies that the level of economic activity, Y, is solely dependent on fluctuations in aggregate demand, as per the IS-LM framework. As prices are fixed, P is normalised to 1 and M represents both real and nominal money stocks. 2. The current account (CA) is determined independently of the capital account. PPP does not hold. CA deficits, as we will later see, depends on Y and the nominal and real exchange rate, e. The higher Y is, the greater the demand for imports; and the lower e is, the more uncompetitive domestic exports will be. The combined effect, based on the Marshall-Lerner (M-L) condition, results in a CA deficit. 3. Static exchange rate expectations and central role of interest rates. International interest rate differentials are assumed to result in finite capital inflows or outflows to a country. Imperfect...
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...劳动力流动的特点纳入了新古典增长模型,建立了一个 适用于我国农村劳动力向城市转移的二元经济增长模型, 并在此基础上分析劳动力转移对平衡增长路径的影响。 二、分析模型 (一)模型的前提条件 (1 )经济分为两个部门:城市部门和农村部门 (2 )2 个部门的生产要素为资本和劳动力 (3 )城市部门生产供投资和消费用的产出,农村 部门只生产供消费用的产出, 也就是说整个社会的投资 由城市部门的生产提供 (4 )以农村部门产品价格为基准的城市部门产品 价格为 P (5 )该国为小国经济,即价格为外生变量 以上条件在二元结构的经济中具有一般性, 在此基 础上我们再作出如下假设, 城市部门和农村部门的生产 76 经济理论研究 函数为强准凹, 一阶齐次函数, 分别为: m Ym=F (Lm,Km) a Ya =F (La,Ka) 为使分析简便这里不考虑技术进步, 因为其规模收 益不变性, 我们可以把两部门的生产函数用资本集约度 表示出来: ym= f(km) , 其中 km =Km/Lm ,ym=Ym/Lm ya=f(ka), 其中 ka =Ka/La ,ya=Ya/La 经济总体的劳动力总量与资本总量分别为:L=L a + Lm +L u ,K=K a+K m ,其中 L a 为农村部门劳动力,L m 为 城市部门劳动力,Lu 为城市部门失业人数,Ka 为农村部 门资本量,Km 为城市部门资本量,资本和劳动力可以在 两部门自由移动, 像一般的新古典经济增长模型一样我 们设定, 城市部门和农村部门的出生率相同为n, 即(dL/ dt)/L= (dLm/dt)/Lm =(dLa/dt)/La=n, 城市部门和农村 部门的折旧率相同为δ, 储蓄率为s, 做了这些约定我们 可以建立模型。 (二)二元经济结构下经济的增长: 根据前面假设, 城市部门资本存量的变动等于投资 减去城市部门折旧,农村部门资本存量的变动只有折 旧,我们可以得到以下两式: dKm /dt=s Ym -δKm ⑴ dKa/dt= -δKa ⑵ 可以看到,如果不存在城市部门向农村部门提供投资 的话,农村部门的资本存量变动是净减少,像其他经济 增长模型一样, 整个经济体的资本集约度用k表示, k=K/ L,则:k=laka+lmkm ⑶ 其中 la =La/L, lm =Lm/L,使用链式法则得到下面 三式: dka/dt=(dK a/dt)/L a-ka(dLa/dt)/L a ⑷ dkm/dt= (dK m /dt)/ Lm -km(dL m/dt)/L m ⑸ 新视角...
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...on many assumptions which may be unrealistic. But this is the best model that economists have. So use it carefully. In 1963 when he was young, Prof. Robert Mundell was working with Marcus Fleming at the IMF and wrote a paper which gave birth to this model. He has been at Columbia University (New York) in the last 25 years. He has been a strong advocate of stabilization of major currencies and establishment of euro. In 1999, he won the Nobel Prize in economics, partly because of the Mundell-Fleming model. The Mundell-Fleming model is an open macro application of the standard IS-LM analysis. More precisely, it is an IS-LM analysis with trade and international capital mobility. (If you do not know what the IS-LM model is, you have a problem. Please look at any intermediate macroeconomic textbook or ask your friend). Consider the following three aspects of the macroeconomy: (1) Aggregate demand (IS and LM curves, representing goods and money markets) (2) Aggregate supply (production function and labor market) (3)...
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...Role of the Multiplier • The Position of the IS Curve • A Summary of the IS Curve • The Money Market and the LM Curve • The Demand for Money • The Supply of Money, Money Market Equilibrium and the LM Curve • The Slope of the LM Curve • Shifts in the LM Curve • A Summary of the LM Curve • Equilibrium in the Goods and Money Markets • Changes in the Equilibrium Income and Interest Rate: A First Look at Policy • Deriving the Aggregate Demand Curve • Working With Data Changes from the Previous Edition One of the major problems with this chapter in the previous editions is that the material was presented in a manner that made it sound like it would be difficult, which is not true. Therefore, the long introduction has been shortened, the confusing diagram (former Figure 12-2) has been removed, and the extra part concerning outline of the chapter has been removed. The derivation of the IS curve section has been rewritten at the beginning. Box 11-1 and Box 11-2 and 11-3 are new The LM curve section has been rewritten to make it more clear, and the relevant diagrams are now side by side, which makes much more sense. The last section of the chapter is rewritten to show the comparative statics of shifts in IS and LM; this serves as a good introduction to Chapter 12. Learning Objectives • Students should be aware that the IS-LM model discussed here is a simplified, short-run, static macro-model, in which prices are assumed to be fixed. ...
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...AKD ME-(E) - PADV ME-(F) - LM ME -(G) -TT ME -(H) - IRS ME - P - SUBH BC - N - MHK BC - L - VSN ISM - I - NJ BC - D - CHE Monday FM - I - DSC FM - J - CANI FM - K - GAR FM - L - NMR FM - M - YGK FM - N - RKJ FM - O - AJM FM - P - RAN FM - Q - STK BC - C - GG ISM - A - STM ISM - B - SSG Monday OB - A - SKN OB - B - RTG X OB - D - BHJ OB - E - SHW OB - F - SRB MM-I - G - SRR OB - H - PRN BC - P - PDM BC - O - GG X X Time Monday ME - I - ARU ME - J - AKD ME - K - IRS ME - L - SUBH ME - M - PADV ME - N - LM ME - O - TT ME - Q - JOJO BC - H - AGK X ISM - C - KVR ISM - D - KB Time FM-I - A - DSC FM-I - B - CANI FM-I - C - NMR FM-I - D - YGK FM-I - E - RKJ FM-I - F - AJM FM-I - G - STK FM-I - H - GIR BC - J - CHE OB - Q - SHW ISM - L - SMY BC - I - PDM Monday 12.20 - 1.35 Monday Tuesday AFM - I - KW AFM - J - RJL AFM - K - AMG AFM - L - RJP AFM - M - VN AFM - N - LNP AFM -O - ATJ AFM -P - PRA AFM - Q - SVL BC - H - AGK BC - A - PDM BC - B - VSN Tuesday QM - A - LS MM-I - M - MKM QM - C - VSG QM - D - VM QM - E - NA QM - F - JYG QM - G - SKW QM - H - SRG OB - K - RTG OB - Q - SHW ISM - I - NJ ISM - J -Raja Tuesday MM-I - I - KSV MM-I - J - JSKC MM-I - K - DIP MM-I - L - HYM X MM-I - N - DBJ X MM-I - P - KCP MM-I - Q - ADM BC - O - GG QM - B - SRG ISM - F - CLD Tuesday AFM - A - LNP AFM - B - BRJ AFM - C - KW AFM - D - RJL AFM - E - PRA X AFM - G - RJP AFM - H - NG X X ISM - M -AJ ISM - N - Raja Tuesday QM - I - LS QM - J - VM QM - K - SRG QM - L - ANS QM - M - NA QM - N - JYG ISM - G -...
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...Improved Robustness Adaptive Step Size LMS Equalization Algorithm and Its Analysis Lan-Jian Cao Department of Communications Zhi-Zhong Fu Department of Communications Qing-Kun Yang Department of Communications University of Electronic Science and Technology of China Chengdu, China caolanjian@126.com University of Electronic Science and Technology of China Chengdu, China fuzz@uestc.edu.cn University of Electronic Science and Technology of China Chengdu, China Yqk86@yahoo.com.cn Abstract- In order to improve the performance of LMS (Least Mean Square) adaptive filtering algorithm, an improved robustness adaptive step-size LMS equalization algorithm was presented by establishing a nonlinear relationship between the two relevant statistics for step-size factor μ ( n ) and the error signal e( n ) . Compared with other algorithms, this algorithm overcomes of sensitivity to the noise coming from outside by introducing the statistics for the correlation of error signal e( n ) . Meanwhile, this algorithm presents some improvement on the principle of robustness. Theoretical analysis and simulation results indicate that this algorithm has a faster convergence speed and a better steady-state error, and can go back to steady state quickly when the channel is varying with time, which shows a better robustness and convergence than other traditional ones. Key words- adaptive equalize; variable step-size; Robustness; least mean square; error signal I. INTRODUCTION ...
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