How to give and to receive feedback

Feedback shouldn't be something to dread. When done right,feedback in the form of appreciation gives people a clear picture of where they’re adding value, helps them understand their strengths, and provides opportunity for improvement.

From qz.com.

Wal-Mart and Amazon compete to sell the Star Shower Motion

Star Shower Price War Shakes Up Retailers
by: Sarah Nassauer and Laura Stevens
Dec 14, 2016
Click here to view the full article on WSJ.com

TOPICS: Pricing

SUMMARY: The battle for sales of outdoor projector Star Shower Motion shows how frequent online price changes have challenged the retail industry. "The battle for Star Shower Motion sales shows how Amazon's frequent online price changes have challenged the retail industry, changing how shoppers compare prices, how traditional retailers price goods and how product manufacturers look to sell their wares. It also illustrates how Amazon is willing to give up profits on a popular item in the hope of capturing more sales from shoppers and maintaining a reputation for having the lowest prices, even if that doesn't apply to every single item."

CLASSROOM APPLICATION: The article offers three interesting points for students to examine. First, retailers sell product lines, and a retailer might lower the price of one product so as to increase the profits of another. Second, retailers compete. Therefore, one retailer, Amazon for example, lowers the price of product to increase sales of other products. However, competitors may not experience the same product complementarities. Hence, in matching Amazon's price, other retailers may be pricing suboptimally. Third, other retailers may be upset with a manufacturer for selling its product to Amazon. In turn, these other retailers may drop the product.

QUESTIONS: 
1. (Advanced) "Mr. Khubani says he worries the weekslong price war has trained some shoppers to expect to pay less for the Star Shower Motion, part of why he is rethinking his strategy for next year, hoping to keep profit margins higher." Why would a manufacturer choose not to sell its product on Amazon? Describe the tradeoff between sales and the wholesale price of the product.

2. (Introductory) Why would Wal-Mart choose to match Amazon's price for popular products, despite a small share of the retail market for the products?

3. (Advanced) "Keeping everybody happy while we are selling on Amazon has become a challenge," Mr. Khubani said. Why are manufacturers concerned about keeping resellers (i.e., retailers) of their products happy?

Reviewed By: James Dearden, Lehigh University

How incentives work in socialist countries

How NOT to motivate physicians: lessons from Cuba

Cuba penalizes physicians for "not meeting quotas" on infant mortality.  How do they respond?

• When pregnancies are deemed risky, doctors have to coerce women to undergo abortion in spite of their wishes. 
•  On top of this, forced sterilization in some cases are an actually documented policy tool. These restrictions do reduce mortality, but they feel like a heavy price for the people. 
•  ...doctors ... lie about the statistics. One thing that is done by the regime is to categorize “infant deaths” as “late fetal deaths” – its basically extending the definition in order to conceal a poorer performance.

What happens when you adjust the infant mortality statistics?

• ...Cuba moves from having an average infant mortality rate ... to having the worst average infant mortality in that dataset – above that of most European and North American countries.

Pricing and price discrimination in the automobile market

Car Dealers Take Steps to Help 'Underwater' Buyers Trade Up
by: Adrienne Roberts and Christina Rogers
Dec 02, 2016
Click here to view the full article on WSJ.com

TOPICS: Pricing

SUMMARY: Customers who owe more than their cars are worth are getting financing incentives including rebates, long loan terms-even cash.

CLASSROOM APPLICATION: Students can evaluate the causes of underwater auto loans, the incentives that auto manufacturers and dealers offer to consumers who are underwater on current loans, and the effect of lower gasoline prices on the types of automobiles that consumers are purchasing,

QUESTIONS: 
1. (Introductory) What are the causes of the increase in the number of car owners who are underwater on their auto loans?

2. (Advanced) What is the effect of a decrease in gasoline prices on the willingness of consumers to trade in the vehicles they purchased when gas prices were higher?

3. (Advanced) Why would car manufacturers and dealers set lower prices for customers who are underwater on their auto loans than for customers who are not?

Reviewed By: James Dearden, Lehigh University

Hoteling and locational choice

https://www.youtube.com/watch?v=jILgxeNBK_8

Incentives matter

http://www.bbc.com/news/blogs-news-from-elsewhere-38208914 reports that visits to nursing homes in China increase when the home pays people to visit.