• Environmental and Resource Economics Review
• /
• v.31 no.4
• /
• pp.755-775
• /
• 2022

This study empirically analyzes that the asymmetry of domestic gasoline price adjustment to the crude oil price changes can vary depending on the level of gasoline price using quantile autoregressive distributed lag model. The data used are the weekly average Dubai price, domestic gasoline price at refiners and gas stations from the first week of May 2008 to the second week of October 2022. The study estimates three price transmission channels: changes in gas station gasoline prices in response to changes in Dubai oil prices, changes in refiners gasoline prices in response to changes in Dubai oil prices, and changes in gas station prices relative to refiners gasoline prices. As a result, the price adjustment of refiner's gasoline price with respect to Dubai oil price appears asymmetrically across all quantiles of gasoline price, whereas the adjustment of gas station prices for Dubai oil price and refiner's gasoline price tend to be more asymmetric as the quantile of gasoline price increases. Such a result is presumed to be due to changes in the inventory cost of gas stations. When the burden of inventory cost is high, gas stations have an incentive to more actively pass the increased buying price on their selling price.

• Environmental and Resource Economics Review
• /
• v.22 no.4
• /
• pp.613-641
• /
• 2013

This paper uses the error correction model to analyse dynamic gasoline price adjustments of the four refiners. Unlike the existing studies, this model allows a refiner's asymmetric adjustment to changes in the other refiners' prices as well as in its own price and costs. With the estimation results, we can obtain the following findings. First, there are the asymmetric price adjustments to changes in exchange rate and international gasoline price, but showing opposing directions. Second, for most of the refiners, the prices respond immediately to the lagged deviation from the long run equilibrium price, but asymmetrically respond for a few refiners. Third, there are some refiners that adjust their price to the other refiners' price deviation from the long run equilibrium. For some refiners, there are competitive price adjustments to the others' price deviations. These findings imply that a refiner faces inelastic demand, intends to maintain implicitly a relative level of its own price to others, and tends to respond competitively to the others' price deviation from the equilibrium.

• Journal of Distribution Science
• /
• v.11 no.10
• /
• pp.73-79
• /
• 2013

Purpose - This study examines the impact of oil price volatility on economic activities in Korea. The new millennium has seen a deregulation in the crude oil market, which invited immense capital inflow into Korea. It has also raised oil price levels and volatility. Drawing on the recent theoretical literature that emphasizes the role of volatility, this paper attends to the asymmetric changes in economic growth in response to the oil price movement. This study further examines several key macroeconomic variables, such as interest rate, production, and inflation. We come to the conclusion that oil price volatility can, in some part, explain the structural changes. Research design, data, and methodology - We use two methodological frameworks in this study. First, in regards to the oil price uncertainty, we use an Exponential-GARCH (Exponential Generalized Autoregressive Conditional Heteroskedasticity: EGARCH) model estimate to elucidate the asymmetric effect of oil price shock on the conditional oil price volatility. Second, along with the estimation of the conditional volatility by the EGARCH model, we use the estimates in a VECM (Vector Error Correction Model). The study thus examines the dynamic impacts of oil price volatility on industrial production, price levels, and monetary policy responses. We also approximate the monetary policy function by the yield of monetary stabilization bond. The data collected for the study ranges from 1990: M1 to 2013: M7. In the VECM analysis section, the time span is split into two sub-periods; one from 1990 to 1999, and another from 2000 to 2013, due to the U.S. CFTC (Commodity Futures Trading Commission) deregulation on the crude oil futures that became effective in 2000. This paper intends to probe the relationship between oil price uncertainty and macroeconomic variables since the structural change in the oil market became effective. Results and Conclusions - The dynamic impulse response functions obtained from the VECM show a prolonged dampening effect of oil price volatility shock on the industrial production across all sub-periods. We also find that inflation measured by CPI rises by one standard deviation shock in response to oil price uncertainty, and lasts for the ensuing period. In addition, the impulse response functions allude that South Korea practices an expansionary monetary policy in response to oil price shocks, which stems from oil price uncertainty. Moreover, a comparison of the results of the dynamic impulse response functions from the two sub-periods suggests that the dynamic relationships have strengthened since 2000. Specifically, the results are most drastic in terms of industrial production; the impact of oil price volatility shocks has more than doubled from the year 2000 onwards. These results again indicate that the relationships between crude oil price uncertainty and Korean macroeconomic activities have been strengthened since the year2000, which resulted in a structural change in the crude oil market due to the deregulation of the crude oil futures.

• Korean Journal of Human Ecology
• /
• v.16 no.1
• /
• pp.159-171
• /
• 2007

The purpose of this research is to analyze the difference of Structural Equation Model which shows the path between BRQ and its performance variables according to purchase product types-fashion brand types, clothing item groups. The subjects were women in their 20s to 40s living in Seoul and Metropolitan areas, and 482 copies of questionnaire were analyzed. Multi-Group Analysis of AMOS 5.0 Package was used to investigate structural equation model according to fashion brand types and clothing item groups. The results of this study were as follows. As for fashion brand types, there appeared to be significant differences between high price brand type and medium-low price brand type for three paths, namely brand satisfaction to brand loyalty, BRQ to brand attitude, and brand attitude to brand loyalty. However the verification of structural equation model according to clothing item groups showed no significant differences between formal wear and informal wear. Consequently, BRQ was proved to affect brand satisfaction and brand loyalty, and brand satisfaction was the important intermediate variable between BRQ and brand loyalty. As consumers were likely to show the difference of structural equation model according to the price of purchase goods, differencial marketing strategy would be suggested.

• Journal of Korean Institute of Industrial Engineers
• /
• v.27 no.4
• /
• pp.345-351
• /
• 2001

We are concerned with a multiple replenishment contract with a purchase price discount in a supply chain. The chain is composed of one supplier, one buyer and consumers for a product. The replenishment contract is based upon the well-known (s, Q) policy but allows contracting several firmed orders at a time with a price discount. Due to a larger forecast error of the future demand, the buyer should keep a higher level of safety stock to provide the same level of service of the usual (s, Q) policy but can reduce his purchase cost by placing larger quantity. Thus there exists a trade-off between the price discount and inventory holding cost. We present a model for the contract and an algorithm to find the optimum number of the firmed orders. Computer experiments show that the algorithm finds the global optimum solution very fast.

• Journal of the Korean Regional Science Association
• /
• v.12 no.2
• /
• pp.59-68
• /
• 1996

Common belief in border regions holds that Mexican cross-border shoppers play a larger role in the regional economic base than they do and that NAFTA will provide a bigger stimulus to the regional economy than it is likely. In the regional economy than it is likely. In the first case, price elasticities are implicitly underestimated as highly inelastic and in the latter case, overestimated as highly elastic. This paper provides empirical evidence on the effects of distance and real exchange rates as price proxies on both field survey and population-imputed estimates of cross-border shopping. After estimating both distance-based and real exchange rate-based estimates of price elasticities of Mexican shopper demand for U.S. border-region goods, implications are obtained concerning the relative importance for U.S. border-regon economies of more distant Mexican markets, and the likely impacts of NAFTA.

• Communications of the Korean Mathematical Society
• /
• v.31 no.2
• /
• pp.415-422
• /
• 2016

We derive a closed-form expression for the price of a European quanto call option when both foreign and domestic interest rates follow the Vasicek's short rate model.

• Asia Marketing Journal
• /
• v.14 no.1
• /
• pp.53-81
• /
• 2012

Constructing attractive bundle offers depends on more than an understanding of the distribution of consumer preferences. Consumers are also sensitive to the framing of price information in a bundle offer. In classical economic theory, consumers' utility should not change as long as the total price paid stays same. However, even when total prices are identical, consumers' preferences toward a bundle product could be different depending on the format of price presentation and the locus of price discount. A weighted additive model predicts that the impact of a price discount on the overall evaluation of the bundle will be greater when the discount is assigned to the more important product in the bundle(Yadav 1995). Meanwhile, a reference dependent model asserts that it is better to assign a price discount to a tie-in component that has a negative valuation at its current offer price than to a focal product that has a positive valuation at its current offer price(Janiszewski and Cunha 2004). This paper has expanded previous research regarding price discount presentation format, investigating the reasons for mixed results of prior research and presenting new mechanisms for price discount framing effect. Prior research has hypothesized that bundling is used to sell a tie-in component with an offer price above the consumer's reference price plus a focal product of the same offer price with reference price(e.g., Janiszewski and Cunha 2004). However, this study suggests that bundling strategy can be used for increasing product's attractiveness through the synergy between components even when offer prices of bundle components are the same with reference prices. In this context, this study employed various realistic bundle sets with same price between offer price and reference price in the experiment. Hamilton and Srivastava(2008) demonstrated that when evaluating different partitions of the same total price, consumers prefer partitions in which the price of the high-benefit component is higher. This study determined that their mechanism can be applied to price discount presentation formats. This study hypothesized that price discount framing effect depends not on the negative perception of tie-in component with offer price above reference price but rather on the consumers' perceived consumption benefit in bundle product. This research also hypothesized that preference for low-benefit discount mechanism is that perceived consumption benefit reduces price sensitivity. Furthermore, this study investigated how consumers' concern for quality in a price discount--a factor not considered in previous research--influences price discount framing. Yadav(1995)'s experiment used only one magazine bundle of relatively low quality uncertainty and could not show the influence of perceived uncertainty of quality. This study assumed that as perceived uncertainty of quality increases, the price sensitivity mechanism for assigning the discount to low-benefit will increase. Further, this research investigated the moderating effect of uncertainty of quality in price discount framing. The results of the experiment showed that when evaluating different partitions of the same total price and the same amount of discounts, the partition that discounts in the price of low benefit component is preferred to the partition that decreases the price of high benefit component. This implies that price discount framing effect depends on the perceived consumption benefit. The results also demonstrated that consumers are more price sensitive to low benefit component and less price sensitive to high benefit component. Furthermore, the results showed that the influence of price discount presentation format on the evaluation of bundle product varies with the perceived uncertainty of quality in high consumption benefit. As perceived uncertainty of quality gradually increases, the preference for discounts in the price of low consumption benefit decreases. Besides, the results demonstrate that as perceived uncertainty of quality gradually increases, the effect of price sensitivity in consumption benefit also increases. This paper integrated prior research by using a new mechanism of perceived consumption benefit and moderating effect of perceived quality uncertainty, thus providing a clearer explanation for price discount framing effect.

• Journal of the Korea Fashion and Costume Design Association
• /
• v.10 no.3
• /
• pp.127-136
• /
• 2008

The main focus of the study resides in antecedents of price acceptability. Levels of acceptable price may be related to the consumers' perception on reasonable or expected price. Price acceptability is known to have several psychological antecedents. One of the antecedents to price acceptability reported by prior researches is price-quality inference, a tendency to correlate high price to excellence in quality. In addition, price-conscious consumers are likely to show lower level of price acceptability level. Another well-known antecedent is sale proneness. Sales-prone consumers may relate price of apparel products to product quality information. Moreover, it was reported that involved consumers should be more concerned with the products to its price and thus should have higher levels of price acceptability. A conceptual model with price consciousness, sale proneness and product involvement as the exogenous variable, price-quality inference and price acceptability as the endogenous variable was developed for the empirical study. Measures of research variables were developed based on previous studies. Questionuaires from 298 respondents were analyzed for the study. The average age of respondents was 27. About 60% of the respondents were married and about 65% of them had college degrees. Empirical results supported all of the hypothesized relationships. Price consciousness had significant negative influence on price-quality inference and price acceptability. Sale proneness significantly influenced price-quality inference, while apparel involvement had significant impact on price-quality inference and price acceptability. Price-quality affected price acceptability significantly. This study generated a framework to help scholars understand antecedents of price acceptability of apparel products. Price has been shown to playa dual role in consumer's perceptions, either positively or negatively. Price consciousness played a negative role, and product involvement had a positive role in evoking higher level of price acceptability. This study also suggests additional source of positive, yet indirect role of price, sale proneness. This study also affirmed the importance of price-quality inference in arousing higher level of price acceptability.

• KIPS Transactions on Software and Data Engineering
• /
• v.10 no.9
• /
• pp.367-374
• /
• 2021

Stock price prediction is a subject of research in various fields such as economy, statistics, computer engineering, etc. In recent years, researches on predicting the movement of stock prices by learning artificial intelligence models from various indicators such as basic indicators and technical indicators have become active. This study proposes a deep learning model that predicts the ups and downs of KOSPI from overseas indices such as S&P500, past KOSPI indices, and trading trends by KOSPI investors. The proposed model extracts a latent variable using a stacked auto-encoder to predict stock price fluctuations, and predicts the fluctuation of the closing price compared to the market price of the day by learning an LSTM suitable for learning time series data from the extracted latent variable to decide to buy or sell based on the value. As a result of comparing the returns and prediction accuracy of the proposed model and the comparative models, the proposed model showed better performance than the comparative models.