Internet commerce has been growing at a rapid pace for the last decade. Many firms try to reach wider consumer markets by adding the Internet channel to the existing traditional channels. Despite the various benefits of the Internet channel, a significant number of firms failed in managing the new type of channel. Previous studies could not cleary explain these conflicting results associated with the Internet channel. One of the major reasons is most of the previous studies conducted analyses under a specific market condition and claimed that as the impact of Internet channel introduction. Therefore, their results are strongly influenced by the specific market settings. However, firms face various market conditions in the real worlddensity and disutility of using the Internet. The purpose of this study is to investigate the impact of various market environments on a firm's optimal channel strategy by employing a flexible game theory model. We capture various market conditions with consumer density and disutility of using the Internet.
shows the channel structures analyzed in this study. Before the Internet channel is introduced, a monopoly manufacturer sells its products through an independent physical store. From this structure, the manufacturer could introduce its own Internet channel (MI). The independent physical store could also introduce its own Internet channel and coordinate it with the existing physical store (RI). An independent Internet retailer such as Amazon could enter this market (II). In this case, two types of independent retailers compete with each other. In this model, consumers are uniformly distributed on the two dimensional space. Consumer heterogeneity is captured by a consumer's geographical location (ci) and his disutility of using the Internet channel (${\delta}_{N_i}$).
shows various market conditions captured by the two consumer heterogeneities.
(a) illustrates a market with symmetric consumer distributions. The model captures explicitly the asymmetric distributions of consumer disutility in a market as well. In a market like that is represented in
(c), the average consumer disutility of using an Internet store is relatively smaller than that of using a physical store. For example, this case represents the market in which 1) the product is suitable for Internet transactions (e.g., books) or 2) the level of E-Commerce readiness is high such as in Denmark or Finland. On the other hand, the average consumer disutility when using an Internet store is relatively greater than that of using a physical store in a market like (b). Countries like Ukraine and Bulgaria, or the market for "experience goods" such as shoes, could be examples of this market condition.
summarizes the various scenarios of consumer distributions analyzed in this study. The range for disutility of using the Internet (${\delta}_{N_i}$) is held constant, while the range of consumer distribution (${\chi}_i$) varies from -25 to 25, from -50 to 50, from -100 to 100, from -150 to 150, and from -200 to 200.
summarizes the analysis results. As the average travel cost in a market decreases while the average disutility of Internet use remains the same, average retail price, total quantity sold, physical store profit, monopoly manufacturer profit, and thus, total channel profit increase. On the other hand, the quantity sold through the Internet and the profit of the Internet store decrease with a decreasing average travel cost relative to the average disutility of Internet use. We find that a channel that has an advantage over the other kind of channel serves a larger portion of the market. In a market with a high average travel cost, in which the Internet store has a relative advantage over the physical store, for example, the Internet store becomes a mass-retailer serving a larger portion of the market. This result implies that the Internet becomes a more significant distribution channel in those markets characterized by greater geographical dispersion of buyers, or as consumers become more proficient in Internet usage. The results indicate that the degree of price discrimination also varies depending on the distribution of consumer disutility in a market. The manufacturer in a market in which the average travel cost is higher than the average disutility of using the Internet has a stronger incentive for price discrimination than the manufacturer in a market where the average travel cost is relatively lower. We also find that the manufacturer has a stronger incentive to maintain a high price level when the average travel cost in a market is relatively low. Additionally, the retail competition effect due to Internet channel introduction strengthens as average travel cost in a market decreases. This result indicates that a manufacturer's channel power relative to that of the independent physical retailer becomes stronger with a decreasing average travel cost. This implication is counter-intuitive, because it is widely believed that the negative impact of Internet channel introduction on a competing physical retailer is more significant in a market like Russia, where consumers are more geographically dispersed, than in a market like Hong Kong, that has a condensed geographic distribution of consumers. illustrates how this happens. When mangers consider the overall impact of the Internet channel, however, they should consider not only channel power, but also sales volume. When both are considered, the introduction of the Internet channel is revealed as more harmful to a physical retailer in Russia than one in Hong Kong, because the sales volume decrease for a physical store due to Internet channel competition is much greater in Russia than in Hong Kong. The results show that manufacturer is always better off with any type of Internet store introduction. The independent physical store benefits from opening its own Internet store when the average travel cost is higher relative to the disutility of using the Internet. Under an opposite market condition, however, the independent physical retailer could be worse off when it opens its own Internet outlet and coordinates both outlets (RI). This is because the low average travel cost significantly reduces the channel power of the independent physical retailer, further aggravating the already weak channel power caused by myopic inter-channel price coordination. The results implies that channel members and policy makers should explicitly consider the factors determining the relative distributions of both kinds of consumer disutility, when they make a channel decision involving an Internet channel. These factors include the suitability of a product for Internet shopping, the level of E-Commerce readiness of a market, and the degree of geographic dispersion of consumers in a market. Despite the academic contributions and managerial implications, this study is limited in the following ways. First, a series of numerical analyses were conducted to derive equilibrium solutions due to the complex forms of demand functions. In the process, we set up V=100, ${\lambda}$=1, and ${\beta}$=0.01. Future research may change this parameter value set to check the generalizability of this study. Second, the five different scenarios for market conditions were analyzed. Future research could try different sets of parameter ranges. Finally, the model setting allows only one monopoly manufacturer in the market. Accommodating competing multiple manufacturers (brands) would generate more realistic results.
Ha, Sangjip;Lee, Junsik;Yoo, In-Jin;Park, Do-Hyung
Journal of Intelligence and Information Systems
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v.27
no.2
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pp.55-78
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2021
Tosolve complex and diverse social problems and ensure the quality of life of individuals, social robots that can interact with humans are attracting attention. In the past, robots were recognized as beings that provide labor force as they put into industrial sites on behalf of humans. However, the concept of today's robot has been extended to social robots that coexist with humans and enable social interaction with the advent of Smart technology, which is considered an important driver in most industries. Specifically, there are service robots that respond to customers, the robots that have the purpose of edutainment, and the emotionalrobots that can interact with humans intimately. However, popularization of robots is not felt despite the current information environment in the modern ICT service environment and the 4th industrial revolution. Considering social interaction with users which is an important function of social robots, not only the technology of the robots but also other factors should be considered. The design elements of the robot are more important than other factors tomake consumers purchase essentially a social robot. In fact, existing studies on social robots are at the level of proposing "robot development methodology" or testing the effects provided by social robots to users in pieces. On the other hand, consumer emotions felt from the robot's appearance has an important influence in the process of forming user's perception, reasoning, evaluation and expectation. Furthermore, it can affect attitude toward robots and good feeling and performance reasoning, etc. Therefore, this study aims to verify the effect of appearance of social robot and consumer emotions on consumer's attitude toward social robot. At this time, a social robot design evaluation model is constructed by combining heterogeneous data from different sources. Specifically, the three quantitative indicator data for the appearance of social robots from the ABOT Database is included in the model. The consumer emotions of social robot design has been collected through (1) the existing design evaluation literature and (2) online buzzsuch as product reviews and blogs, (3) qualitative interviews for social robot design. Later, we collected the score of consumer emotions and attitudes toward various social robots through a large-scale consumer survey. First, we have derived the six major dimensions of consumer emotions for 23 pieces of detailed emotions through dimension reduction methodology. Then, statistical analysis was performed to verify the effect of derived consumer emotionson attitude toward social robots. Finally, the moderated regression analysis was performed to verify the effect of quantitatively collected indicators of social robot appearance on the relationship between consumer emotions and attitudes toward social robots. Interestingly, several significant moderation effects were identified, these effects are visualized with two-way interaction effect to interpret them from multidisciplinary perspectives. This study has theoretical contributions from the perspective of empirically verifying all stages from technical properties to consumer's emotion and attitudes toward social robots by linking the data from heterogeneous sources. It has practical significance that the result helps to develop the design guidelines based on consumer emotions in the design stage of social robot development.
Marketing financial services used to be easier. Today, the competition in financial services is fierce. Not only has the competition become more intense, financial services have also changed structurally. In an environment with various customer needs and severe competitions, the marketing in financial services industry is getting more difficult and more important than before. However, there are still not enough studies on financial services marketing in Korea whereas lots of research papers have been published frequently in some international journals. The purpose of this paper is (1)to review the literature on financial services marketing, (2)to investigate current marketing activities based on in-depth interview with financial marketing managers in Korea, and (3)to suggest some implications for future research on the financial services marketing. Financial products are not consumer products. In fact, they are not products at all in the way product marketing is usually described. Nor are they altogether like services. The financial industry operates in a unique way, and its marketing tasks are correspondingly complex. However, the literature review shows that there has been a lack of basic studies which dealt with inherent characteristics of financial services marketing compared to the research on marketing in other industries. Many studies in domestic marketing journals have so far focused only on the general customer behaviors and the special issues in some financial industries. However, for more effective financial services marketing, we have to answer following questions. Is there any difference between financial service marketing and consumer packaged goods marketing? What are the differences between the financial services marketing and other services marketing such as education and health services? Are there different ways of marketing among banks, securities firms, insurance firms, and credit card companies? In other words, we need more detailed research as well as basic studies about the financial services marketing. For example, we need concrete definitions of financial services marketing, bank marketing, securities firm marketing, and etc. It is also required to compare the characteristics of each marketing within the financial services industry. The products sold in each market have different characteristics such as duration and degree of risk-taking. It means that there are sub-categories in financial services marketing. We have to consider them in the future research on the financial services marketing. It is also necessary to study customer decision making process in the financial markets. There have been little research on how customers search and process information, compare alternatives, make final decision, and repeat their choices. Because financial services have some unique characteristics, we need different understandings in the customer behaviors compared to the behaviors in other service markets. And also considering the rapid growth in financial markets and upcoming severe competition between domestic and global financial companies, it is time to start more systematic and detailed research on financial services marketing in Korea. In the second part of this paper, I analyzed the results of in-depth interview with 20 marketing managers of financial services companies in Korea. As a result, I found that the role of marketing departments in Korean financial companies are mainly focused on the short-term activities such as sales support, promotion, and CRM data analysis although the size and history of marketing departments to some extent show a sign of maturity. Most companies established official marketing departments before 2001. Average number of employees in a marketing department is about 58. However, marketing managers in eight companies(40% of the sample) still think that the purpose of marketing is only to support and manage general sales activities. It shows that some companies have sales-oriented concept rather than marketing-oriented concept. I also found three key words which marketing managers think importantly in financial services markets. They are (1)Trust in customer relationship, (2)Brand differentiation, and (3)Rapid response to customer needs. 50% of the sample support that "Trust" is the most important key word in the financial services marketing. It is interesting that 80% of banks and securities companies think that "Trust" is the most important thing, whereas managers in credit card companies consider "Rapid response to customer needs" as the most important key word in their market. In addition, there are different problems recognition of marketing managers depending on the types of financial industries they belong to. For example, in the case of banks and insurance companies, marketing managers consider "a lack of communication with other departments" as the most serious problem. On the other hand, in the case of securities firms, "a lack of utilization of customer data" is the most serious problem. These results imply that there are different important factors for the customer satisfaction depending on the types of financial industries, and managers have to consider them when marketing financial products in more effective ways. For example, It will be necessary for marketing managers to study different important factors which affect customer satisfaction, repeat purchase, degree of risk-taking, and possibility of cross-selling according to the types of financial industries. I also suggested six hypothetical propositions for the future research.
Lee, Hee Jae;Lim, So Young;Kang, Min-Gyung;Park, Jeongjin;Chung, Hyun-Jung;Yang, Soo Jin
Journal of the Korean Society of Food Science and Nutrition
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v.44
no.4
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pp.491-496
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2015
The purpose of this study was to assess the antioxidant, anti-inflammatory, and immuno-enhancing effects of Daebong persimmon (DP) and Bansi (BS) in vivo. Two types of astringent persimmons (DP and BS) were used for this experiment. C57BL/6J mice were assigned to the following groups: 1) lean control, 2) high-fat diet control (HF), 3) A region DP (3% wt/wt) with HF diet (A-DP), 4) B region DP with HF diet (B-DP), 5) C region DP with HF diet (C-DP), 6) D region BS with HF diet (D-BS), and 7) E region BS with HF diet (E-BS). All mice were sacrificed after 4 weeks of treatment, after which blood and tissues were collected. Antioxidant enzyme activities, inflammatory markers, and immune factors were evaluated. DP and BS treatments did not alter food intake or body weight, compared with HF. Administration of B-DP increased catalase activities in serum. Hepatic levels of malondialdehyde, a product of lipid peroxidation, were significantly lower in A-DP mice than in the HF group. A-DP had down-regulatory effects against inflammation induced by high-fat diet feeding, as shown by significant reduction of interleukin (IL)-$1{\beta}$, IL-6, and tumor necrosis factor-${\alpha}$. Additionally, A-DP treatment exerted an immuno-stimulatory effect, as shown by increasing levels of immunoglobulin G. DP treatment improved the level of insulin-like growth factor-1. These results indicate that DP has beneficial health effects on oxidative stress, inflammation, and immunity in vivo.
The Bric-a-brac, Tramtrack, Broad-complex (BTB) domain is a protein-protein interaction domain that is found in many zinc finger transcription factors. BTB containing proteins play important roles in a variety of cellular functions including regulation of transcription, regulation of the cytoskeleton, protein ubiquitination, angiogenesis, and apoptosis. Here, we report the cloning and characterization of a novel human gene, KLHL31, from a human embryonic heart cDNA library. The cDNA of KLHL31 is 5743 bp long, encoding a protein product of 634 amino acids containing a BTB domain. The protein is highly conserved across different species. Western blot analysis indicates that the KLHL31 protein is abundantly expressed in both embryonic skeletal and heart tissue. In COS-7 cells, KLHL31 proteins are localized to both the nucleus and the cytoplasm. In primary cultures of nascent mouse cardiomyocytes, the majority of endogenous KLHL31 proteins are localized to the cytoplasm. KLHL31 acts as a transcription repressor when fused to GAL4 DNA-binding domain and deletion analysis indicates that the BTB domain is the main region responsible for this repression. Overexpression of KLHL31 in COS-7 cells inhibits the transcriptional activities of both the TPA-response element (TRE) and serum response element (SRE). KLHL31 also significantly reduces JNK activation leading to decreased phosphorylation and protein levels of the JNK target c-Jun in both COS-7 and Hela cells. These results suggest that KLHL31 protein may act as a new transcriptional repressor in MAPK/JNK signaling pathway to regulate cellular functions.
Journal of the Korean Society of Clothing and Textiles
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v.28
no.12
s.138
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pp.1596-1604
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2004
Quality Function Deployment(QFD) is a product development tool which ensures that the voice of the customer needs is heard and translated into products. To develop a sensible brassiere for middle-aged women QFD was adopted. In this study the applicability and usefulness of QFD was examined through the engineering design process for a sensible brassiere for middle-aged women. The customer needs for the wear comfort of brassiere was made by one-on-one survey of 100 women who aged 30-40. The customer competitive assessment was generated by wearing tests of 10 commercial brassieres. The subjective assessment was conducted in the enviornmental chamber that was controlled at $28{\pm}1^{\circ}C,\;65{\pm}3\%RH.$ As a results, we developed twenty-one customer needs and corresponding HOWs for the wear comfort of brassiere. The Customer Competitive Assessment was generated by wearing tests of commercial brassiere. The subjective measurement scale and dimension for the evaluation of sensible brassiere were extracted from factor analysis. Four factors were fitting, aesthetic property, pressure sensation, displacement of brassiere due to movement. The most critical design parameter was wire-related property and second one was stretchability of main material of brassiere. Also, wearing comfort of brassiere was affected by the interaction of initial stretchability of wing and support of strap. Engineering design process, QFD was applicable to the development of technical and aesthetic brassieres.
In the field of fisheries, there is at the apex Central Federation of Fishery Cooperatives, established under the Fishery Cooperatives Law(1962), It is a multipurpose organization with a membership of 105 cooperatives, 87 regional cooperatives, 15 business-type cooperatives and 3 manufactures' cooperatives. Accordingly, this thesis examines the marketing of fishery cooperatives in Korea, and in particular considers the marketing channel strategy of fisheries products. No company can perform by itself all the activities involved in the production and distribution of its products and services to its final markets. It must work with other firms to get the job done. Thus marketing channel firms of the fisheries products include primarily the fishery cooperatives, the licensed In the field of fisheries, there is at the apex Central Federation of Fishery Cooperatives, established under the Fishery Cooperatives Law (1962). It is a multipurpose organization with a membership of 105 cooperatives, 87 regional cooperatives, 15 business-type cooperatives and 3 manufactures' cooperatives. Accordingly, this thesis examines the marketing of fishery cooperatives in Korea, and in particular considers the marketing channel strategy of fisheries products. No company can perform by itself all the activities involved in the production and distribution of its products and services to its final markets. It must work with other firms to get the job done. Thus marketing channel firms of the fisheries products include primarily the fishery cooperatives, the licensed dealers and the merchant middlemen. The goal of marketing is in matching of segments of supply and demand. Every producer seeks to the link the marketing channel firms that will help it accomplish its objective best. This thesis tries to attempt to improve the present Korean Fishery Cooperatives marketing activities. The purpose of the operation of fishery cooperatives is to guarantee the profits of fisherman as well as the interests of general consumers by eliminating the inordinate profits of middlemen and by narrowing other market margins. Fishery cooperatives marketing activity functions forming a self-helf organization for economic protection of producers themselves, and acting as a market reformational institution through its transaction by group. The following are the characteristics of fishery cooperatives marketing. \circled1 Fishery cooperatives is organized with an economic factor and a personnel factor. \circled2 Fishery cooperatives is non-profit organization. \circled3 The members of fishery cooperatives is independent constitution of economy, but they are closely connected with the cooperative. \circled4 Fishery cooperatives is a mutual aid organization. The objective of an efficient marketing strategy may be well described by the common saying provides the right product at the right time, the right place, and the right price. But it is quite true that the Korean Fishermen's Cooperative can be said to owe its development to the successful implementation of the marketing system. The use of the marketing system has resulted in the following marketing strategy. 1. The direct marketing system. \circled1 The cooperation between the fishery cooperatives and the other cooperative through the collection and delivery center. \circled2 The selling between the fishery cooperatives and the large scale retailers through the process industry. 2. The vertical marketing system. \circled1The fishermen's cooperative to be nominated by wholesaler in the terminal market. \circled2 Contracted vertical marketing system. \circled3 Abolition of selling by double auction in the landing and the terminal market. 3. The physical distribution system. \circled1 The need for adoption of cold chain system to connect production directly to consumption. \circled2 The need for more expansion of landing markets and terminal market facilities. Solutions to the problems of the Korean fishery are made possible through effective functioning of cooperative marketing activities of fishery products. The marketing concept of fishermen's cooperative lies in the satisfaction of consumer needs. According to the marketing concept fishermen's cooperative should try to satisfy customer's needs through a coodinated set of activities that allows the organization to achieve its goal. Providing satisfaction to customers is the major trust of the marketing concept. To do this, a business must find out what will satisfy customers. With this information the cooperative sells to the greatest possible number of customers through the most efficient sales and marketing channels. Economic rationality of fishermen's cooperative marketing lies in reduction of marketing cost and elimination of intermediate institutions. Cooperative marketing and direct marketing are both indispensable marketing factors for a new cooperative organization among the manu ways. The cooperation between the fishermen's cooperative and the others cooperative, and vertical marketing system are the most necessary ones. Propulsion of cooperative marketing system could not be successful without the support of the marketing instituion's help. Consequently, successful cooperative marketing ought to lead to the necessity not only for the improvement of marketing organization, but for the application of a new marketing concept in the fishermen's cooperative.
Journal of Fisheries and Marine Sciences Education
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v.27
no.5
/
pp.1457-1469
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2015
This study was undertaken to investigate the quality changes of salted-fermented anchovy meat made by varying the amount of salt during fermentation at $15^{\circ}C$. Anchovy (11.0-14.0 cm of length, 10.7-17.5 g of weight) added with 15-25% of salt was filled in a round form plastic container (i.d. $10.5{\times}11cm$), and then fermented at $15^{\circ}C$ for 110 days. The factors such as proximate composition, pH, color value (L, a, b), TBA value, amino-N content, salinity, hardness value, free amino acid content and sensory evaluation of salted-fermented anchovy meat were measured. Ash content, color value (redness), TBA value, amino-N content. salinity and hardness value of salted-fermented anchovy meat were increased, but color value (lightness), and moisture content were decreased during fermentation at $15^{\circ}C$. A salted-fermented anchovy meat added with 15% of salt was shown higher content of moisture, amino-N content and free amino acid, TBA value than those of 20 or 25% of salt. Ash content, salinity and hardness value were highest in a product added with 25% of salt. From the result of sensory evaluation, Addition amount of 15% salt and fermentation periods of 110 days were determined to be the most desirable palatability of salted-fermented anchovy meat.
Serum-contain is commoly used for the production of in vitro-derived bovine embryos. However, were biological activity of serum varies from lot to lot, time consuming to choose better serum with good quality and risks of virus, bacteria and mycoplasma infection. This study established serum-free culture systems of in vitro embryo development to efficiently obtain a large number of blastocysts from ovaries of Hanwoo and oocytes maturation, cell number, tlerance of cryopreservation. Secondly, serum-contain medium is suspected of contributing to the large calf size, dystocia, cersarean sections, calf mortality and confirmed these blastocysts are high quality in terms of cyotolerance, high rates of pregancy and normal birth. For these reasons, Culture media (IVMD101 and IVD101) designed specifically for the preimplantation bovine embryo are rather simplistic, being based on salt solutions with additional energy substrates and growth factors. An improved serum-free medium (IVMD101) was developed for bovine oocytes maturation in vitro. Proportions of embryos developing to the blastocyst stage cultured in both IVD101(32.4%) and IVD101(34.5%) serum-free media were higher than in TCM199+10% FBS(12.4%) serumcontaining medium. Futhermore, the cell numbers per blastosyst obtained in the serum-free media were superior to those of blastocysts developed in serum-supplemented medium. Also, cell numbers of blastocysts obtained in the serum-free media were similar with blastocysts derived in vivo. Survival rate blastocysts after 24 hr incubation after thawing, the blastocysts cultured in both IVD101(94.5%) and IVD101(95.8%) serum-free media were higher than in TCM199+10% FBS (52.5%) serum-containing medium. After 72 hr incubation after thawing, hatching rates of blastocysts developed in IVD101(78.4%) and IVMD101(83.7%) were sighnificantly higher than that developed in the serum-supplemented medium(32.0%). The pregnancy rates almost not different between fresh blastocysts(38.2%) and frozen blastocysts(34.9%). The results suggested that the improved serum-free media(IVMD101 and IVD101) offer several advantages over culture in serum-cotaining medium, including increased rates of blastocyst formation and high cel numbers. Additionally, the survival and hatching rates of embryos product in serum-free media after post-thaw culture were superior to those of embryos produced in the serum-containg medium and useful for the production of high quality bovine embryos for cryo-preservation. These improved serum-free media are beneficial not only for the study of the mechanisms of early embryogenesis but also for mass production of good quality embryos for embryo transfer, cloning and transgenesis.
The major objective of this research is to identify those hospital characteristics that best explain cost variation among hospitals and to formulate linear models that can predict hospital costs. Specific emphasis is placed on hospital output, that is, the identification of diagnosis related patient groups (DRGs) which are medically meaningful and demonstrate similar patterns of hospital resource consumption. A casemix index is developed based on the DRGs identified. Considering the common problems encountered in previous hospital cost research, the following study requirements are estab-lished for fulfilling the objectives of this research: 1. Selection of hospitals that exercise similar medical and fiscal practices. 2. Identification of an appropriate data collection mechanism in which demographic and medical characteristics of individual patients as well as accurate and comparable cost information can be derived. 3. Development of a patient classification system in which all the patients treated in hospitals are able to be split into mutually exclusive categories with consistent and stable patterns of resource consumption. 4. Development of a cost finding mechanism through which patient groups' costs can be made comparable across hospitals. A data set of Medicare patients prepared by the Social Security Administration was selected for the study analysis. The data set contained 27,229 record abstracts of Medicare patients discharged from all but one short-term general hospital in Connecticut during the period from January 1, 1971, to December 31, 1972. Each record abstract contained demographic and diagnostic information, as well as charges for specific medical services received. The 'AUT-OGRP System' was used to generate 198 DRGs in which the entire range of Medicare patients were split into mutually exclusive categories, each of which shows a consistent and stable pattern of resource consumption. The 'Departmental Method' was used to generate cost information for the groups of Medicare patients that would be comparable across hospitals. To fulfill the study objectives, an extensive analysis was conducted in the following areas: 1. Analysis of DRGs: in which the level of resource use of each DRG was determined, the length of stay or death rate of each DRG in relation to resource use was characterized, and underlying patterns of the relationships among DRG costs were explained. 2. Exploration of resource use profiles of hospitals; in which the magnitude of differences in the resource uses or death rates incurred in the treatment of Medicare patients among the study hospitals was explored. 3. Casemix analysis; in which four types of casemix-related indices were generated, and the significance of these indices in the explanation of hospital costs was examined. 4. Formulation of linear models to predict hospital costs of Medicare patients; in which nine independent variables (i. e., casemix index, hospital size, complexity of service, teaching activity, location, casemix-adjusted death. rate index, occupancy rate, and casemix-adjusted length of stay index) were used for determining factors in hospital costs. Results from the study analysis indicated that: 1. The system of 198 DRGs for Medicare patient classification was demonstrated not only as a strong tool for determining the pattern of hospital resource utilization of Medicare patients, but also for categorizing patients by their severity of illness. 2. The wei틴fed mean total case cost (TOTC) of the study hospitals for Medicare patients during the study years was $11,27.02 with a standard deviation of $117.20. The hospital with the highest average TOTC ($1538.15) was 2.08 times more expensive than the hospital with the lowest average TOTC ($743.45). The weighted mean per diem total cost (DTOC) of the study hospitals for Medicare patients during the sutdy years was $107.98 with a standard deviation of $15.18. The hospital with the highest average DTOC ($147.23) was 1.87 times more expensive than the hospital with the lowest average DTOC ($78.49). 3. The linear models for each of the six types of hospital costs were formulated using the casemix index and the eight other hospital variables as the determinants. These models explained variance to the extent of 68.7 percent of total case cost (TOTC), 63.5 percent of room and board cost (RMC), 66.2 percent of total ancillary service cost (TANC), 66.3 percent of per diem total cost (DTOC), 56.9 percent of per diem room and board cost (DRMC), and 65.5 percent of per diem ancillary service cost (DTANC). The casemix index alone explained approximately one half of interhospital cost variation: 59.1 percent for TOTC and 44.3 percent for DTOC. Thsee results demonstrate that the casemix index is the most importand determinant of interhospital cost variation Future research and policy implications in regard to the results of this study is envisioned in the following three areas: 1. Utilization of casemix related indices in the Medicare data systems. 2. Refinement of data for hospital cost evaluation. 3. Development of a system for reimbursement and cost control in hospitals.
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