Dynamic Limit and Predatory Pricing Under Uncertainty (불확실성하(不確實性下)의 동태적(動態的) 진입제한(進入制限) 및 약탈가격(掠奪價格) 책정(策定))
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- KDI Journal of Economic Policy
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- v.13 no.1
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- pp.151-166
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- 1991
In this paper, a simple game-theoretic entry deterrence model is developed that integrates both limit pricing and predatory pricing. While there have been extensive studies which have dealt with predation and limit pricing separately, no study so far has analyzed these closely related practices in a unified framework. Treating each practice as if it were an independent phenomenon is, of course, an analytical necessity to abstract from complex realities. However, welfare analysis based on such a model may give misleading policy implications. By analyzing limit and predatory pricing within a single framework, this paper attempts to shed some light on the effects of interactions between these two frequently cited tactics of entry deterrence. Another distinctive feature of the paper is that limit and predatory pricing emerge, in equilibrium, as rational, profit maximizing strategies in the model. Until recently, the only conclusion from formal analyses of predatory pricing was that predation is unlikely to take place if every economic agent is assumed to be rational. This conclusion rests upon the argument that predation is costly; that is, it inflicts more losses upon the predator than upon the rival producer, and, therefore, is unlikely to succeed in driving out the rival, who understands that the price cutting, if it ever takes place, must be temporary. Recently several attempts have been made to overcome this modelling difficulty by Kreps and Wilson, Milgram and Roberts, Benoit, Fudenberg and Tirole, and Roberts. With the exception of Roberts, however, these studies, though successful in preserving the rationality of players, still share one serious weakness in that they resort to ad hoc, external constraints in order to generate profit maximizing predation. The present paper uses a highly stylized model of Cournot duopoly and derives the equilibrium predatory strategy without invoking external constraints except the assumption of asymmetrically distributed information. The underlying intuition behind the model can be summarized as follows. Imagine a firm that is considering entry into a monopolist's market but is uncertain about the incumbent firm's cost structure. If the monopolist has low cost, the rival would rather not enter because it would be difficult to compete with an efficient, low-cost firm. If the monopolist has high costs, however, the rival will definitely enter the market because it can make positive profits. In this situation, if the incumbent firm unwittingly produces its monopoly output, the entrant can infer the nature of the monopolist's cost by observing the monopolist's price. Knowing this, the high cost monopolist increases its output level up to what would have been produced by a low cost firm in an effort to conceal its cost condition. This constitutes limit pricing. The same logic applies when there is a rival competitor in the market. Producing a high cost duopoly output is self-revealing and thus to be avoided. Therefore, the firm chooses to produce the low cost duopoly output, consequently inflicting losses to the entrant or rival producer, thus acting in a predatory manner. The policy implications of the analysis are rather mixed. Contrary to the widely accepted hypothesis that predation is, at best, a negative sum game, and thus, a strategy that is unlikely to be played from the outset, this paper concludes that predation can be real occurence by showing that it can arise as an effective profit maximizing strategy. This conclusion alone may imply that the government can play a role in increasing the consumer welfare, say, by banning predation or limit pricing. However, the problem is that it is rather difficult to ascribe any welfare losses to these kinds of entry deterring practices. This difficulty arises from the fact that if the same practices have been adopted by a low cost firm, they could not be called entry-deterring. Moreover, the high cost incumbent in the model is doing exactly what the low cost firm would have done to keep the market to itself. All in all, this paper suggests that a government injunction of limit and predatory pricing should be applied with great care, evaluating each case on its own basis. Hasty generalization may work to the detriment, rather than the enhancement of consumer welfare.
This study was performed to determine what the plant material were selected to reflect in the 2016 Korea Garden Show designer's garden. It was analyzed that plant material was used to display the theme of the garden and to create a specific space. Under the given theme of 'K-Garden, Shinhallyu Garden(new style garden culture) with the most Korean taste', the plants were used to highlight the theme in two types: 'representation' and 'expression'. There were two 'representation' gardens that imitate a particular space of Korean taste and four 'expression' gardens that showcase the designer's thoughts with abstract concepts and concrete objects. Three gardens included both types of garden. The way of revealing the subject with plants was used more for 'expression' than for 'representation'. There were eleven spaces for 'representation' of the Korean taste, a vegetable garden, faucet, pond, field, nature, a Hanok court garden, groves of bamboo, tile roof, stone wall, rock and backyard of a Hanok connected to the mountain. The planting material was used in two ways: reflecting only the ecological characteristics of the plant, and considering the ecological and visual characteristics together. Vegetation plantings reflecting the ecological characteristics were observed in all eleven spaces. Nine of the spaces reflected the growth environment of the plants, but the other two did not reflect the ecological characteristics of the plants, unlike the designer's intention. In the case of the four spaces that considered the ecological and visual characteristics together, color and size were considered visual characteristics. The plants in the seven spaces that included 'expression' as the theme were selected to reflect the visual characteristics in the order of color, shape, texture, and size, rather than reflecting ecological characteristics. A group planting method was applied. When the plants were used as materials for creating space, Norman(1989) analyzed three enclosure factors(overhead, vertical, ground plane). Only two deciduous trees were used in the overhead plane while five species of evergreen shrubs and thirty species of various deciduous plants were used in the vertical plane. There were forty-five species (nine trees and thirty-six herbaceous plants) forming the ground plane, and various herbaceous plants were utilized without duplication in each garden. The designer's garden of the Garden Show played a role in introducing new groundcover plants to the public. Three of the nine gardens did not include ornamental plants, and the use of decorative plants in other gardens was few compared to the number of plantings. In the Korea Garden Show designer's garden, most of the plants were being used with the intention of exposing the theme or architectural uses. In the 2016 Korea Garden Show designer's garden, many species of plants were used as materials for showcasing themes rather than for creating spaces. Also, the method of 'expression' was used more than the method of 'representation' in order to highlight the theme. This indicates that the planting materials reflect visual characteristics such as color, shape, texture, size rather than ecological characteristics.
In china, six bibliographies of offical historical books are evaluated at the most important things among the systematically-editing bibliographies. These bibliographies would be usful to study the orign of classical sciences and their development, bibliographic research of Chinese classics, bibliographic judgement on genuine books, titles, authors, volumes. They could be refered to research into graving, correcting, and existence of ancient books. therefore, these bibliographies would be applied to estimation the phase of scientific and cultural development. The study of these bibliographies has been not yet made in Korea. This thesis lays its importance on the background of their appearance, their classification norms, organizing system of their catalogue, and comparison between their difference. 1. Editing and compiling of Chilyak (칠약) by Liu Chin (유흠) and official histories played an important role of entering an apperance of historical book's bibliographies. Chilyak has been lost. However, its classification and compiling system of classical books would be traced by Hansoyemunji(한서예문지) of which basic system is similar to Chilyak. It classified books according to their scientific characteristic. If a few books didn't have their own categories, they were combined by the circles parallel to the books' characteristic. With the books classified under the same scientific characteristic, they were again divided into the scientific schools or structures. It also arranged the same kinds of books according to the chronology. The some books wi th duplicate subjects were classified multiplely by their duplicate subject. 2. Ssu-ma Chon's (사마천) The Historical Records (Saki, 사기) and Pan Ku's (반고) The History of the Former Han Dynasty (Hanso, 한서) has also took effects on appearance of historical books' bibliographies. Covering overall history, Saki was structured by the five parts: The basic annals(본기), the chronological tables (표), the documents (서), the hereditary houses (세가), biographies (열전). The basic annals dealt with kings and courts' affairs according to the chronology. The chronological tables was the records of the annals. The documents described overall the social and cultural systems. The hereditary houses recorded courts' meritorious officials and public figures. The biographies showed exemplars of seventy peoples selected by their social status. Pan Ku(반구)'s The History of the Former Han Dynasty(한서) deserved to be called the prototype for the offical histories after Saki's (사기; The Historical Records) apperance. Although it modelled on Saki, it had set up its own cataloguing system. It was organized by four parts; the basic annals (본기), the chronological tables (표), treatises(지), biographies (열전). The documents in the Hanso(한서) was converted into treatises(지). The hereditary houses and biographies were merged. For the first time, the treatise with The Yemunji could operate function for historical bibliographies. 3. There were six historical bibliographies: Hansoyemunji(한서예문지), Susokyongjeokji (수서경적지), Kudangsokyongjeokji(구당서경적지), Shindangsoyemunji (신당서예문지), Songsayemunji (송사예문지), Myongsayemunji (명사예문지). 1) Modelling on Liu Chin's Chilyak except Chipryak(집략), Hansoyemunji divided the characteristic of the books and documents into six parts: Yukrye(육예), Cheja(제자), Shibu(시부), Pyongsoh(병서), Susul(수술), Pangki(방기). Under six parts, there were thirty eight orders in Hansoyemunji. To its own classification, Hansoyemunji applied the Chilyak's theory of classification that the books or documents were managed according to characteristic of sciences, the difference of schools, the organization of sentences. However the overlapped subjects were deleted and unified into one. The books included into an unsuitable subject were corrected and converted into another. The Hansoyemunji consisted of main preface (Taesoh 대서), minor preface (Sosoh 소서) , the general preface (Chongso 총서). It also recorded the introduction of books and documents, the origin of sciences, the outline of subjects, and the establishment of orders. The books classified by the subject had title, author, and volumes. They were rearranged by titles and the chronological publication year. Sometimes author was the first access point to catalogue the books. If it was necessary for the books to take footnotes, detail notes were formed. The Volume number written consecutively to order and subject could clarify the quantity of books. 2) Refering to Classfication System by Seven Norms (칠분법) and Classification System by Four Norms(사분법), Susokyongjeokji(수서경적지) had accomplished the classification by four norms. In fact, its classification largely imitated Wanhyosoh(완효서)'s Chilrok(칠록), Susokyongjeokji's system of classification consisted of four parts-Kyung(경), Sa(사), Cha(자), Chip(칩). The four parts were divided into 40 orders. Its appendix was again divided into two parts, Buddihism and Taiosm. Under the two parts there were fifteen orders. Totally Susokyongjeokji was made of six parts and fifty five orders. In comparison with Hansoyemunji(한서예문지), it clearly showed the conception of Kyung, Sa, Cha, Chip. Especially it deserved to be paid attention that Hansoyemunji laied history off Chunchu(춘추) and removed history to Sabu(사부). However Chabu(사부) put many contrary subjects such as Cheja(제자), Kiye(기예), Sulsu(술수), Sosol(소설) into the same boundary, which committed errors insufficient theoretical basis. Anothor demerit of Susokyongjeokji was that it dealt with Taiosm scriptures and Buddism scriptures at the appendix because they were considered as quasi-religion. Its compilation of bibliographical facts consisted of main preface(Taesoh 대서), minor preface(Sosoh 소서), general preface (Chongsoh 총서), postscript (Husoh 후서). Its bibliological facts mainly focused on the titles. Its recorded authors' birth date and their position. It wrote the lost and existence of books consecutive to total number of books, which revealed total of the lost books in Su Dynasty. 3) Modelling on the basis of Kokumsorok(고분서록) and Naewaekyongrok(내외경록), Kudangsokyongjeokji(구당서경적지) had four parts and fourty five orders. It was estimated as the important role of establishing basic frame of classification by four norms in classification theory's history. However it had also its own limit. Editing and compling orders of Kudangsokyongjeokji had been not progressively changed. Its orders imitated by and large Susokyongjeokji. In Its system of organizing catalogue, with its minor preface and general preface deleting, Kudangsokyongjeokji by titles after orders sometimes broke out confusion because of unclear boundaries between orders. 4) Shindangsoyemunji(신당서예문지), adding 28,469 books to Kudangsokyongjeokji, recorded 82,384 books which were divided by four parts and fourty four orders. In comparison with Kudangkyongjeokj, Sindangsoyemunji corrected unclear order's norm. It merged the analogical norms four orders (for instance, Kohun 고훈 and Sohakryu 소학류) and seperated the different norms four orders (for example, Hyokyong 효경 and Noneuhryu 논어류, Chamwi 참위 and Kyonghaeryu 경해류, Pyonryon 편년 and Wisaryu 위사류). Recording kings' behaviors and speeches (Kikochuryu 기거주류) in the historical parts induced the concept of specfication category. For the first time, part of Chipbu (집부) set up the order of classification norm for historical and literatural books and documents (Munsaryu 문사류). Its editing and compiling had been more simplified than Kudangsokyongjeokji. Introduction was written at first part of bibliographies. Appendants except bibliographic items such subject, author, title, volume number, total were omitted. 5) Songsayemunji(송사예문지) were edited in the basis of combining Puksong(북송) and Namsong(남송), depending on Sabukuksayemunji(사부국사예문지). Generally Songsayemunji had lost a lot of bibliographical facts of many books. They were duplicated and wrongly classified books because it committed an error of the incorrectly annalistic editing. Particularly Namsong showed more open these defaults. Songsayemunji didin't include the books published since the king Youngchong(영종). Its system of classification was more better controlled. Chamwiryu(참위류) in the part of Kyongbu(경부) was omitted. In the part of history(Sabu 사부), recordings of kings' behaviors and speeches more merged in the annals. Historical abstract documents (Sachoryu 사초류) were seperately arranged. In the part of Chabu(자부), Myongdangkyongmaekryu(명당경맥류) and Euisulryu(의술류) were combined. Ohangryu(오행류) were laied off Shikuryu(시구류). In the part of Chipbu(집부), historical and literatural books (Munsaryu 문사류) were independentely arranged. There were the renamed orders; from Wisa(위사) to Paesa(패사), Chapsa (잡사) to Pyolsa(열사), Chapchonki(잡전기) to Chonki(전기), Ryusoh(류서) to Ryusa(류서). Introduction had only main preface. The books of each subject catalogued by title, the volume number, and author and arranged mainly by authors. Annotations were written consecutively after title and the volume number. In the afternote the number of not-treated books were revealed. Difference from Singdangsohyemunji(신당서예문지) were that the concept and boundary of orders became more clearer. It also wrote the number of books consecutive to main subject. 6) Modelling on Chonkyongdangsomok (경당서목), Myongsayemunji(명사예문지) was compiled in the basis of books and documents published in the Ming Danasty. In classification system, Myongsayemunji partly merged and the seperated some orders for it. It also deleted and renamed some of orders. In case of necessity, combining of orders' norm was occured particulary in the part of Sabu(사부) and Chabu(자부). Therefore these merging of orders norm didn't offer sufficient theretical background. For example, such demerits were seen in the case that historical books edited by annals were combined with offical historical ones which were differently compiled and edited from the former. In the part of Chabu(자부), it broke out another confusion that Pubga(법가), Meongga(명가), Mukga(묵가), Chonghweongka's(종횡가) thoughts were classified in the Chapka(잡가). Scriptures of Taiosim and Buddhism were seperated from each other. There were some deleted books such as Mokrokryu(목록류), Paesaryu(패사류) in the part of history (Sabu 사부) and Chosaryu(초사류) in the part of Chipbu(집부). The some in the each orders had been renamed. Imitating compiling system of Songsayemunji(송사예문지), with reffering to its differ-ence, Myongsayemunji(명사예문지) wrote the review and the change of the books by author. The number of not-treated books didn't appear at the total. It also deleted the total following main subject.
Today's consumers perceive consumption as a representation of themselves. It is not simply an act that fulfills a consumer's physical and practical needs. Even in terms of life quality, consumers increasingly want to achieve an emotional and sensible experience through consumption. Consumers now make decisions based on their need to express their position in relation to other people, pursue emotional satisfaction, and try to improve the quality of life. Culture-art products that meet such internal and external demands of consumers have made significant improvements in both quantity and quality, because of the social interest and policy support. The recognition of personal and social values of culture and arts has brought about interest in and need for culture-art products. Businesses have agilely embraced such change and actively implemented various marketing strategies utilizing culture and arts. For example, businesses began to sponsor artists who produce culture-art products while building facilities for cultural and art performances or exhibitions. Businesses have also provided performances and exhibitions free-of-charge or at affordable prices. As a result, the supply in the market has started to exceed its demand as is often the case in many of other markets. However, such imbalance has occurred not because of over-supply but because of a lack of demand. Given these circumstances, the government and culture and art related organizations, which had mainly concentrated on the supply side, started to recognize the importance of creating personal and social values in culture and arts. As a result, the government and various organizations are now creating various strategies that include policy measures to achieve their new found goal. Unfortunately however, such efforts are not meeting the expectations. Focusing on above-mentioned circumstances and problems, this study aims to find measures to create demand for culture-art products in the internal conditions of those who consume culture-art products. In other words, given that the demand for culture-art products has not increased despite all external conditions to encourage consumption, this study aims to find the reasons in consumers' value judgment on culture-art products. Though there were recent studies on culture-art products that applied consumer behavior on marketing theories, most of them focused on peripheral aspects such as people's motivation for or satisfaction from watching culture-art events. Hence, there is a need to understand what kind of value consumers perceive from culture-art products and how such value cognition leads to consumption in a comprehensive manner. This study acts as follow-up to a separate study entitled "Qualitative Study about Value Cognition and Benefits of Consumer on Culture-Art Products". The current study aims to extend practical implications that enhance the effectiveness of marketing strategies among the producing and policy agencies in the industry. The purpose of this study is to investigate dimensions of value cognition, benefits and attributes of culture-art products, and identify the effects of consumer value cognition on benefits and attributes. The questionnaire was developed based on the conceptual structure of qualitative research and previous researches. It was composed of value cognition, benefits, attributes of culture-art products and demographic variables. This survey was conducted on-line and off-line among a total of 662 persons ranging from their teens to their 50's who were living in Seoul, Gyeonggi-do, various metropolitan cities, and small and medium-sized cities. The data collected was analyzed by factor analysis and path analysis using SPSS WIN 18.0 and AMOS 16.0. This empirical study found that the dimensions of value cognition of culture-art products were categorized into personal goods, aesthetic goods and public property. This shows that the consumers perceive culture-art products as products that are worthy enough to pay the costs not just for personal benefits but also for their social values. Also the formation of value cognition for culture-art products requires special conditions unlike that for physical consumer goods and services, which simply require marketing stimuli. The dimensions of benefits pursued by consuming culture-art products were found to be composed of four types - pursuit of aesthetic benefits, pursuit of actual benefits, pursuit of emotional benefits, and pursuit of conspicuous character. This result implies that people consume culture-art products not just to pursue pleasure from emotional and intelligent satisfaction as well as social relations, but also to seek the needs and benefits embodied at a social level. The dimensions of attributes of culture-art products had seven different factors, - environmental, price, evaluation, people, artwork, composition, and personal relations - which is plentiful. This is because the attributes of culture-art products are very complicated compared to other consumer goods or services. Since culture-art products include not just cultural or artistic works but also all physical, human, environmental, and systemic elements of the products in a comprehensive manner, consumers perceive everything they experience in the process of consuming culture-art products as part of the products. The dimensions of value cognition was found to affect attributes of the products, mostly using pursued benefits as a mediating factors. This result is consistent with the result of qualitative research, and proves that applying the means-end chain theory in the reverse direction is reasonable. The result can be interpreted that consumers' value cognitions for culture-art products turns into actual benefits leading to consumers' decisions. Furthermore, this result reveals that when consumers choose culture-art products, they take into account the attributes of culture-art products depending on the benefits they pursue. These results confirm that despite their conceptual and abstract attributes, culture-art products have values that contribute to actual benefits for individual consumers and society. Hence, value cognition generates benefits to be pursued and this in turn affects the consumers' choices of attributes on products. Based on the conceptual structure of consumers' value cognitions on culture-art products and its dimensions, it is possible to find detailed methods to provide opportunities for education and training to form and reinforce positive value cognition on culture-art products. And through those methods, it will be possible to develop attributes of culture-art products according to the dimensions of pursued benefits, and allow conceptual products become the subject to valuable consumption in real life. These results provide theoretical understanding of consumer behavior in culture marketing and useful information to culture-art producers, companies that use culture and art, and government agencies that use culture-art as a mean to improve the public perception of quality of life. As a follow up on this study, there should be experimental studies that can develop criteria visualizing the demands of consumers who purchase culture-art products and identify their detailed attributes. Studies that compare characteristics of different areas within the culture-art product category and in-depth studies on a specific area or genre will also be needed. In order to develop marketing strategies for culture-art products, studies on the formation and reinforcement of positive value cognition on culture-art products and education for the development of consumer demand as well as on the development and differentiation of attributes of culture-art products depending on types of consumer groups should also follow.
This study investigated consumer intention to use a location-based mobile shopping service (LBMSS) that integrates cognitive and affective responses. Information relevancy was integrated into pleasure-arousal-dominance (PAD) emotional state model in the present study as a conceptual framework. The results of an online survey of 335 mobile phone users in the U.S. indicated the positive effects of arousal and information relevancy on pleasure. In addition, there was a significant relationship between pleasure and intention to use a LBMSS. However, the relationship between dominance and pleasure was not statistically significant. The results of the present study provides insight to retailers and marketers as to what factors they need to consider to implement location-based mobile shopping services to improve their business performance. Extended Abstract : Location aware technology has expanded the marketer's reach by reducing space and time between a consumer's receipt of advertising and purchase, offering real-time information and coupons to consumers in purchasing situations (Dickenger and Kleijnen, 2008; Malhotra and Malhotra, 2009). LBMSS increases the relevancy of SMS marketing by linking advertisements to a user's location (Bamba and Barnes, 2007; Malhotra and Malhotra, 2009). This study investigated consumer intention to use a location-based mobile shopping service (LBMSS) that integrates cognitive and affective response. The purpose of the study was to examine the relationship among information relevancy and affective variables and their effects on intention to use LBMSS. Thus, information relevancy was integrated into pleasure-arousal-dominance (PAD) model and generated the following hypotheses. Hypothesis 1. There will be a positive influence of arousal concerning LBMSS on pleasure in regard to LBMSS. Hypothesis 2. There will be a positive influence of dominance in LBMSS on pleasure in regard to LBMSS. Hypothesis 3. There will be a positive influence of information relevancy on pleasure in regard to LBMSS. Hypothesis 4. There will be a positive influence of pleasure about LBMSS on intention to use LBMSS. E-mail invitations were sent out to a randomly selected sample of three thousand consumers who are older than 18 years old and mobile phone owners, acquired from an independent marketing research company. An online survey technique was employed utilizing Dillman's (2000) online survey method and follow-ups. A total of 335 valid responses were used for the data analysis in the present study. Before the respondents answer any of the questions, they were told to read a document describing LBMSS. The document included definitions and examples of LBMSS provided by various service providers. After that, they were exposed to a scenario describing the participant as taking a saturday shopping trip to a mall and then receiving a short message from the mall. The short message included new product information and coupons for same day use at participating stores. They then completed a questionnaire containing various questions. To assess arousal, dominance, and pleasure, we adapted and modified scales used in the previous studies in the context of location-based mobile shopping service, each of the five items from Mehrabian and Russell (1974). A total of 15 items were measured on a seven-point bipolar scale. To measure information relevancy, four items were borrowed from Mason et al. (1995). Intention to use LBMSS was captured using two items developed by Blackwell, and Miniard (1995) and one items developed by the authors. Data analyses were conducted using SPSS 19.0 and LISREL 8.72. A total of usable 335 data were obtained after deleting the incomplete responses, which results in a response rate of 11.20%. A little over half of the respondents were male (53.9%) and approximately 60% of respondents were married (57.4%). The mean age of the sample was 29.44 years with a range from 19 to 60 years. In terms of the ethnicity there were European Americans (54.5%), Hispanic American (5.3%), African-American (3.6%), and Asian American (2.9%), respectively. The respondents were highly educated; close to 62.5% of participants in the study reported holding a college degree or its equivalent and 14.5% of the participants had graduate degree. The sample represents all income categories: less than $24,999 (10.8%), $25,000-$49,999 (28.34%), $50,000-$74,999 (13.8%), and $75,000 or more (10.23%). The respondents of the study indicated that they were employed in many occupations. Responses came from all 42 states in the U.S. To identify the dimensions of research constructs, Exploratory Factor Analysis (EFA) using a varimax rotation was conducted. As indicated in table 1, these dimensions: arousal, dominance, relevancy, pleasure, and intention to use, suggested by the EFA, explained 82.29% of the total variance with factor loadings ranged from .74 to .89. As a next step, CFA was conducted to validate the dimensions that were identified from the exploratory factor analysis and to further refine the scale. Table 1 exhibits the results of measurement model analysis and revealed a chi-square of 202.13 with degree-of-freedom of 89 (p =.002), GFI of .93, AGFI = .89, CFI of .99, NFI of .98, which indicates of the evidence of a good model fit to the data (Bagozzi and Yi, 1998; Hair et al., 1998). As table 1 shows, reliability was estimated with Cronbach's alpha and composite reliability (CR) for all multi-item scales. All the values met evidence of satisfactory reliability in multi-item measure for alpha (>.91) and CR (>.80). In addition, we tested the convergent validity of the measure using average variance extracted (AVE) by following recommendations from Fornell and Larcker (1981). The AVE values for the model constructs ranged from .74 through .85, which are higher than the threshold suggested by Fornell and Larcker (1981). To examine discriminant validity of the measure, we again followed the recommendations from Fornell and Larcker (1981). The shared variances between constructs were smaller than the AVE of the research constructs and confirm discriminant validity of the measure. The causal model testing was conducted using LISREL 8.72 with a maximum-likelihood estimation method. Table 2 shows the results of the hypotheses testing. The results for the conceptual model revealed good overall fit for the proposed model. Chi-square was 342.00 (df = 92, p =.000), NFI was .97, NNFI was .97, GFI was .89, AGFI was .83, and RMSEA was .08. All paths in the proposed model received significant statistical support except H2. The paths from arousal to pleasure (H1:
The basic purpose of this study is to investigate perceived quality and service personal value affecting the result of long-term relationship between service buyers and suppliers. This research presented a constructive model(perceived quality affecting the service personal value and the moderate effect of NFC) in the on off line and then propose the research model base on prior researches and studies about relationships among components of service. Data were gathered from respondents who visit at the education service market. For this study, Data were analyzed by AMOS 7.0. We integrate the literature on services marketing with researches on personal values and perceived quality. The SERPVAL scale presented here allows for the creation of a common ground for assessing service personal values, giving a clear understanding of the key value dimensions behind service choice and usage. It will lead to a focus of future research in services marketing, extending knowledge in the field and stimulating further empirical research on service personal values. At the managerial level, as a tool the SERPVAL scale should allow practitioners to evaluate and improve the value of a service, and consequently, to define strategies and actions to address services for customers based on their fundamental personal values. Through qualitative and empirical research, we find that the service quality construct conforms to the structure of a second-order factor model that ties service quality perceptions to distinct and actionable dimensions: outcome, interaction, and environmental quality. In turn, each has two subdimensions that define the basis of service quality perceptions. The authors further suggest that for each of these subdimensions to contribute to improved service quality perceptions, the quality received by consumers must be perceived to be reliable, responsive, and empathetic. Although the service personal value may be found in researches that explore individual values and their consequences for consumer behavior, there is no established operationalization of a SERPVAL scale. The inexistence of an established scale, duly adapted in order to understand and analyze personal values behind services usage, exposes the need of a measurement scale with such a purpose. This need has to be rooted, however, in a conceptualization of the construct being scaled. Service personal values can be defined as a customer's overall assessment of the use of a service based on the perception of what is achieved in terms of his own personal values. As consumer behaviors serve to show an individual's values, the use of a service can also be a way to fulfill and demonstrate consumers'personal values. In this sense, a service can provide more to the customer than its concrete and abstract attributes at both the attribute and the quality levels, and more than its functional consequences at the value level. Both values and services literatures agree, that personal value is the highest-level concept, followed by instrumental values, attitudes and finally by product attributes. Purchasing behaviors are agreed to be the end result of these concepts' interaction, with personal values taking a major role in the final decision process. From both consumers' and practitioners' perspectives, values are extremely relevant, as they are desirable goals that serve as guiding principles in people's lives. While building on previous research, we propose to assess service personal values through three broad groups of individual dimensions; at the self-oriented level, we use (1) service value to peaceful life (SVPL) and, at the social-oriented level, we use (2) service value to social recognition (SVSR), and (3) service value to social integration (SVSI). Service value to peaceful life is our first dimension. This dimension emerged as a combination of values coming from the RVS scale, a scale built specifically to assess general individual values. If a service promotes a pleasurable life, brings or improves tranquility, safety and harmony, then its user recognizes the value of this service. Generally, this service can improve the user's pleasure of life, since it protects or defends the consumer from threats to life or pressures on it. While building upon both the LOV scale, a scale built specifically to assess consumer values, and the RVS scale for individual values, we develop the other two dimensions: SVSR and SVSI. The roles of social recognition and social integration to improve service personal value have been seriously neglected. Social recognition derives its outcome utility from its predictive utility. When applying this underlying belief to our second dimension, SVSR, we assume that people use a service while taking into consideration the content of what is delivered. Individuals consider whether the service aids in gaining respect from others, social recognition and status, as well as whether it allows achieving a more fulfilled and stimulating life, which might then be revealed to others. People also tend to engage in behavior that receives social recognition and to avoid behavior that leads to social disapproval, and this contributes to an individual's social integration. This leads us to the third dimension, SVSI, which is based on the fact that if the consumer perceives that a service strengthens friendships, provides the possibility of becoming more integrated in the group, or promotes better relationships at the social, professional or family levels, then the service will contribute to social integration, and naturally the individual will recognize personal value in the service. Most of the research in business values deals with individual values. However, to our knowledge, no study has dealt with assessing overall personal values as well as their dimensions in a service context. Our final results show that the scales adapted from the Schwartz list were excluded. A possible explanation is that although Schwartz builds on Rokeach work in order to explore individual values, its dimensions might be especially focused on analyzing societal values. As we are looking for individual dimensions, this might explain why the values inspired by the Schwartz list were excluded from the model. The hierarchical structure of the final scale presented in this paper also presents theoretical implications. Although we cannot claim to definitively capture the dimensions of service personal values, we believe that we come close to capturing these overall evaluations because the second-order factor extracts the underlying commonality among dimensions. In addition to obtaining respondents' evaluations of the dimensions, the second-order factor model captures the common variance among these dimensions, reflecting the respondents' overall assessment of service personal values. Towards this fact, we expect that the service personal values conceptualization and measurement scale presented here contributes to both business values literature and the service marketing field, allowing for the delineation of strategies for adding value to services. This new scale also presents managerial implications. The SERPVAL dimensions give some guidance on how to better pursue a highly service-oriented business strategy. Indeed, the SERPVAL scale can be used for benchmarking purposes, as this scale can be used to identify whether or not a firms' marketing strategies are consistent with consumers' expectations. Managerial assessment of the personal values of a service might be extremely important because it allows managers to better understand what customers want or value. Thus, this scale allows us to identify what services are really valuable to the final consumer; providing knowledge for making choices regarding which services to include. Traditional approaches have focused their attention on service attributes (as quality) and service consequences(as service value), but personal values may be an important set of variables to be considered in understanding what attracts consumers to a certain service. By using the SERPVAL scale to assess the personal values associated with a services usage, managers may better understand the reasons behind services' usage, so that they may handle them more efficiently. While testing nomological validity, our empirical findings demonstrate that the three SERPVAL dimensions are positively and significantly associated with satisfaction. Additionally, while service value to social integration is related only with loyalty, service value to peaceful life is associated with both loyalty and repurchase intent. It is also interesting and surprising that service value to social recognition appears not to be significantly linked with loyalty and repurchase intent. A possible explanation is that no mobile service provider has yet emerged in the market as a luxury provider. All of the Portuguese providers are still trying to capture market share by means of low-end pricing. This research has implications for consumers as well. As more companies seek to build relationships with their customers, consumers are easily able to examine whether these relationships provide real value or not to their own lives. The selection of a strategy for a particular service depends on its customers' personal values. Being highly customer-oriented means having a strong commitment to customers, trying to create customer value and understanding customer needs. Enhancing service distinctiveness in order to provide a peaceful life, increase social recognition and gain a better social integration are all possible strategies that companies may pursue, but the one to pursue depends on the outstanding personal values held by the service customers. Data were gathered from 284 respondents in the korean discount store and online shopping mall market. This research proposed 3 hypotheses on 6 latent variables and tested through structural equation modeling. 6 alternative measurements were compared through statistical significance test of the 6 paths of research model and the overall fitting level of structural equation model. and the result was successful. and Perceived quality more positively influences service personal value when NFC is high than when no NFC is low in the off-line market. The results of the study indicate that service quality is properly modeled as an antecedent of service personal value. We consider the research and managerial implications of the study and its limitations. In sum, by knowing the dimensions a consumer takes into account when choosing a service, a better understanding of purchasing behaviors may be realized, guiding managers toward customers expectations. By defining strategies and actions that address potential problems with the service personal values, managers might ultimately influence their firm's performance. we expect to contribute to both business values and service marketing literatures through the development of the service personal value. At a time when marketing researchers are challenged to provide research with practical implications, it is also believed that this framework may be used by managers to pursue service-oriented business strategies while taking into consideration what customers value.