INFORMATION STRUCTURES OF PRODUCT MARKETS

Buyers demand continuing information flows to guide their choices among competing product brands. They select portfolios of information types, some supplied by sellers of the branded goods, some not. This paper investigates the determinants of businesses' outlays on information (media advertising, sales force, other sales promotion). They include buyers' overall demands for information, buyers' access to sources not controlled by the seller, the relative efficiency of seller-supplied information, and competitive conditions in the product market. The hypotheses about effects on sellers' total information outlays are strongly supported. Some evidence appears on determinants of the mixture of information types they provide.     

OPTION VALUE: A GENERAL APPROACH

This article examines a potential bias if expected consumer surplus is used to measure the benefits of a price change under uncertainty. This bias, which is called option value, may be positive or negative. A general framework is developed for analyzing the determinants of the sign of option value, and this framework is applied to three types of uncertainty: income uncertainty, quality uncertainty, and uncertainty over consumer tastes. In the first two cases, option value has a determinate sign; however, in the last case, option value may be positive, negative, or zero in an unpredictable fashion.     

WORK AND LEISURE ON THE REPORTING OF POLL RESULTS

Louis Harris has reported a substantial increase in work between1973 and 1985 and a corresponding decrease in the availabilityof free time. Data from the Current Employment Statistics ofthe Department of Labor show a decline of the work week in thesame period. Data from the National Opinion Research Center'sGeneral Social Surveys show a rough constancy in the work week.Previous analyses of Current Population Survey results alsopoint to constancy as the appropriate conclusion for the periodin question. Examination of the Harris studies shows five changesin procedure. These changes in method may well have producedthe dramatic changes he reported. Harris's finding is challengedalso by other results from his studies, which show increasedparticipation in a wide range of leisure-time activities.     

THE EFFECT OF TECHNICAL CHANGE ON MARKET STRUCTURE

The paper examines the effects of technical change on market structure. It is found that: 1) the role of independent inventors and small firms is much more important in the early stages of the evolution of a product; 2) the net effect of innovations on entry reverses itself over the product cycle; 3) there is a shift in the importance of various sources of innovation over the product cycle. The two forces which contribute to this result are: 1) a decline in the importance of innovations as technology matures and 2) the proliferation of products adapted to specialized uses.     

Mutual Intention

This paper takes as its starting point the problem of characterizing, in a precise way, situations in which two people collaborate to achieve a common goal. It is suggested that collaboration is normally based on an apparently paradoxical state of mind which I call "mutual intention". Mutual intention is a concept belonging to the same family as Lewis's and Schiffer's "mutual knowledge". These concepts have the paradoxical feature that they require, for their definition, an infinite series of propositions of the form X knows (or intends, or assumes) p, where X is a single agent and p is a proposition. The source of these infinite series is traced, and it is shown that they can be represented in a plausible and enlightening way by means of a recursive notation. Finally, three applications of the concept of "mutual intention" are given: (i) in the semantic analysis of certain sentences with plural subjects; (ii) in the analysis of agreement and related speech acts; and (iii) in the clarification of the phenomenon of "implicit agreement".     

MARKET STRUCTURE AND POLITICAL INFLUENCE: NEW DATA ON POLITICAL EXPENDITURES, ACTIVITY, AND SUCCESS

This paper utilizes new data to evaluate the determinants of the political influence of thirty-five manufacturing industries on the U.S. Congress during 1976–80. Several measures of influence serve to distinguish between political activity and success. Seller concentration and geopolitical dispersion increase both activity and success, but neither industry size nor leading-firm size proves significant. We test whether political expenditures facilitate obtaining the favors conferred on an industry by its market structure or by influence independent of that strurture; statistical inference strongly confirms both roles.     

THE CONTROL OF EXTERNALITIES IN A GROWING URBAN ECONOMY

The received theory of externality control, which implicitly assumes that both the social marginal damage and marginal treatment cost schedules will remain fixed during the time any policy is operative, concludes that an effluent tax and an auction of rights to emit pollutants in the amount of a given emissions standard will be equally efficient in meeting that standard. We show that urban growth causes shifts in both schedules. These shifts in turn substantially increase the welfare loss from a fixed effluent tax relative to that from an auction market with a fixed number of licenses.