Advertising Impact

Quant Mark Econ (2009) 7:207–236 DOI 10. 1007/s11129-009-9066-z The effect of advertising on brand awareness and perceived quality: An empirical investigation using panel data C. Robert Clark  · Ulrich Doraszelski  · Michaela Draganska Received: 11 December 2007 / Accepted: 2 April 2009 / Published online: 8 May 2009  © Springer Science + Business Media, LLC 2009 Abstract We use a panel data set that combines annual brand-level advertising expenditures for over three hundred brands with measures of brand awareness and perceived quality from a large-scale consumer survey to study the effect of advertising.Advertising is modeled as a dynamic investment in a brand’s stocks of awareness and perceived quality and we ask how such an investment changes brand awareness and quality perceptions. Our panel data allow us to control for unobserved heterogeneity across brands and to identify the effect of advertising from the time-series variation within brands. They also allow us to account for the endogeneity of advertising through recently developed dynamic panel data estimation techniques. We ? nd that advertising has consistently a signi? cant positive effect on brand awareness but no signi? ant effect on perceived quality. Keywords Advertising  · Brand awareness  · Perceived quality  · Dynamic panel data methods JEL Classi? cation L15  · C23  · H37 C. R. Clark Institute of Applied Economics, HEC Montreal and CIRPEE, 3000 Chemin de la Cote-Sainte-Catherine, Montreal, Quebec H3T 2A7, Canada e-mail: robert. [email  protected] ca U. Doraszelski Department of Economics, Harvard University, 1805 Cambridge Street, Cambridge, MA 02138, USA e-mail: [email  protected] edu ) M. Draganska (B Graduate School of Business, Stanford University, Stanford, CA 94305-5015, USA e-mail: [email  protected] tanford. edu 208 C. R. Clark et al. 1 Introduction In 2006 more than $280 billion were spent on advertising in the U. S. , well above 2% of GDP. By inve sting in advertising, marketers aim to encourage consumers to choose their brand. For a consumer to choose a brand, two conditions must be satis? ed: First, the brand must be in her choice set. Second, the brand must be preferred over all the other brands in her choice set. Advertising may facilitate one or both of these conditions. In this research we empirically investigate how advertising affects these two conditions.To disentangle the impact on choice set from that on preferences, we use actual measures of the level of information possessed by consumers about a large number of brands and of their quality perceptions. We compile a panel data set that combines annual brand-level advertising expenditures with data from a large-scale consumer survey, in which respondents were asked to indicate whether they were aware of different brands and, if so, to rate them in terms of quality. These data offer the unique opportunity to study the role of advertising for a wide range of brands ac ross a number of different product categories.The awareness score measures how well consumers are informed about the existence and the availability of a brand and hence captures directly the extent to which the brand is part of consumers’ choice sets. The quality rating measures the degree of subjective vertical product differentiation in the sense that consumers are led to perceive the advertised brand as being better. Hence, our data allow us to investigate the relationship between advertising and two important dimensions of consumer knowledge.The behavioral literature in marketing has highlighted the same two dimensions in the form of the size of the consideration set and the relative strength of preferences (Nedungadi 1990; Mitra and Lynch 1995). It is, of course, possible that advertising also affects other aspects of consumer knowledge. For example, advertising may generate some form of subjective horizontal product differentiation that is unlikely to be re? ected in ei ther brand awareness or perceived quality. In a recent paper Erdem et al. (2008), however, report that advertising focuses on horizontal attributes only for one out of the 19 brands examined.Understanding the channel through which advertising affects consumer choice is important for researchers and practitioners alike for several reasons. For example, Sutton’s (1991) bounds on industry concentration in large markets implicitly assume that advertising increases consumers’ willingness to pay by altering quality perceptions. While pro? ts increase in perceived quality, they may decrease in brand awareness (Fershtman and Muller 1993; Boyer and Moreaux 1999), thereby stalling the competitive escalation in advertising at the heart of the endogenous sunk cost theory.Moreover, Doraszelski and Markovich (2007) show that even in small markets industry dynamics can be very different depending on the nature of advertising. From an empirical perspective, when estimating a demand mo del, advertising could be modeled Effect of advertising on brand awareness and perceived quality 209 as affecting the choice set or as affecting the utility that the consumer derives from a brand. If the role of advertising is mistakenly speci? ed as affecting quality perceptions (i. e. , preferences) rather than brand awareness as it often is, then the estimated parameters may be biased.In her study of the U. S. personal computer industry, Sovinsky Goeree (2008) ? nds that traditional demand models overstate price elasticities because they assume that consumers are aware of—and hence choose among—all brands in the market when in actuality most consumers are aware of only a small fraction of brands. For our empirical analysis we develop a dynamic estimation framework. Brand awareness and perceived quality are naturally viewed as stocks that are built up over time in response to advertising (Nerlove and Arrow 1962).At the same time, these stocks depreciate as consumers forget past advertising campaigns or as an old campaign is superseded by a new campaign. Advertising can thus be thought of as an investment in brand awareness and perceived quality. The dynamic nature of advertising leads us to a dynamic panel data model. In estimating this model we confront two important problems, namely unobserved heterogeneity across brands and the potential endogeneity of advertising. We discuss these below. When estimating the effect of advertising across brands we need to keep in mind that they are different in many respects.Unobserved factors that affect both advertising expenditures and the stocks of perceived quality and awareness may lead to spurious positive estimates of the effect of advertising. Put differently, if we detect an effect of advertising, then we cannot be sure if this effect is causal in the sense that higher advertising expenditures lead to higher brand awareness and perceived quality or if it is spurious in the sense that different brand s have different stocks of perceived quality and awareness as well as advertising expenditures.For example, although in our data the brands in the fast food category on average have high advertising and high awareness and the brands in the cosmetics and fragrances category have low advertising and low awareness, we cannot infer that advertising boosts awareness. We can only conclude that the relationship between advertising expenditures, perceived quality, and brand awareness differs from category to category or even from brand to brand. Much of the existing literature uses cross-sectional data to discern a relationship between advertising expenditures and perceived quality (e. g. Kirmani and Wright 1989; Kirmani 1990; Moorthy and Zhao 2000; Moorthy and Hawkins 2005) in an attempt to test the idea that consumers draw inferences about the brand’s quality from the amount that is spent on advertising it (Nelson 1974; Milgrom and Roberts 1986; Tellis and Fornell 1988). With cross -sectional data it is dif? cult to account for unobserved heterogeneity across brands. Indeed, if we neglect permanent differences between brands, then we ? nd that both brand awareness and perceived quality are positively correlated with advertising expenditures, thereby replicating the earlier studies.Once we make full use of our panel data and account for unobserved 210 C. R. Clark et al. heterogeneity, however, the effect of advertising expenditures on perceived quality disappears. 1 Our estimation equations are dynamic relationships between a brand’s current stocks of perceived quality and awareness on the left-hand side and the brand’s previous stocks of perceived quality and awareness as well as its own and its rivals’ advertising expenditures on the right-hand side. In this context, endogeneity arises for two reasons.First, the lagged dependent variables are by construction correlated with all past error terms and therefore endogenous. As a consequence, traditional ? xed-effect methods are necessarily inconsistent. 2 Second, advertising expenditures may also be endogenous for economic reasons. For instance, media coverage such as news reports may affect brand awareness and perceived quality beyond the amount spent on advertising. To the extent that these shocks to the stocks of perceived quality and awareness of a brand feed back into decisions about advertising, say because the brand manager opts to advertise less if a news report has generated suf? ient awareness, they give rise to an endogeneity problem. To resolve the endogeneity problem we use the dynamic panel data methods developed by Arellano and Bond (1991), Arellano and Bover (1995), and Blundell and Bond (1998). The key advantage is that these methods do not rely on the availability of strictly exogenous explanatory variables or instruments. This is an appealing methodology that has been widely applied (e. g. , Acemoglu and Robinson 2001; Durlauf et al. 2005; Zhang and L i 2007) because valid instruments are often hard to come by. Further, since these methods involve ? st differencing, they allow us to control for unobserved factors that affect both advertising expenditures and the stocks of perceived quality and awareness and may lead to spurious positive estimates of the effect of advertising. In addition, our approach allows for factors other than advertising to affect a brand’s stock of perceived quality and awareness to the extent that these factors are constant over time. Our main ? nding is that advertising expenditures have a signi? cant positive effect on brand awareness but no signi? cant effect on perceived quality.These results appear to be robust across a wide range of speci? cations. Since awareness is the most basic kind of information a consumer can have for a brand, we conclude that an important role of advertising is information provision. On the other hand, our results indicate that advertising is not likely to alter consum ers’ quality perceptions. This conclusion calls for a reexamination of the implicit assumption underlying Sutton’s (1991) endogenous sunk cost theory. It also suggests that advertising should be modeled as affecting the choice set and not just utility when estimating demand.Finally, our ? ndings lend empirical 1 Another way to get around this issue is to take an experimental approach, as in Mitra and Lynch (1995). 2 This source of endogeneity is not tied to advertising in particular; rather it always arises in estimating dynamic relationships in the presence of unobserved heterogeneity. An exception is the (rather unusual) panel-data setting where one has T > ? instead of N > ?. In this case the within estimator is consistent (Bond 2002, p. 5). Effect of advertising on brand awareness and perceived quality 211 upport to the view that advertising is generally procompetitive because it disseminates information about the existence, the price, and the attributes of product s more widely among consumers (Stigler 1961; Telser 1964; Nelson 1970, 1974). The remainder of the paper proceeds as follows. In Sections 2 and 3 we explain the dynamic investment model and the corresponding empirical strategy. In Section 4 we describe the data and in Section 5 we present the results of the empirical analysis. Section 6 concludes. 2 Model speci? cation We develop an empirical model based on the classic advertising-as-investment model of Nerlove and Arrow (1962).Related empirical models are the basis of current research on advertising (e. g. , Naik et al. 1998; Dube et al. 2005; Doganoglu and Klapper 2006; Bass et al. 2007). Naik et al. (1998), in particular, ? nd that the Nerlove and Arrow (1962) model provides a better ? t than other models that have been proposed in the literature such as Vidale and Wolfe (1957), Brandaid (Little 1975), Tracker (Blattberg and Golanty 1978), and Litmus (Blackburn and Clancy 1982). We extend the Nerlove and Arrow (1962) framework in two respects. First, we allow a brand’s stocks of awareness and perceived quality to be affected by the advertising of its competitors.This approach captures the idea that advertising takes place in a competitive environment where brands vie for the attention of consumers. The advertising of competitors may also be bene? cial to a brand if it draws attention to the entire category and thus expands the relevant market for the brand (e. g. , Nedungadi 1990; Kadiyali 1996). Second, we allow for a stochastic component in the effect of advertising on the stocks of awareness and perceived quality to re? ect the success or failure of an advertising campaign and other unobserved in? uences such as the creative quality of the advertising copy, media selection, or scheduling.More formally, we let Qit be the stock of perceived quality of brand i at the start of period t and Ait the stock of its awareness. We further let Eit? 1 denote the advertising expenditures of brand i over the cou rse of period t ? 1 and E? it? 1 = (E1t? 1 , . . . , Ei? 1t? 1 , Ei+1t? 1 , . . . , Ent? 1 ) the advertising expenditures of its competitors. Then, at the most general level, the stocks of perceived quality and awareness of brand i evolve over time according to the laws of motion Qit = git (Qit? 1 , Eit? 1 , E? it? 1 , ? it ), Ait = hit (Ait? 1 , Eit? 1 , E? it? 1 , ? t ), where git ( ·) and hit ( ·) are brand- and time-speci? c functions. The idiosyncratic error ? it captures the success or failure of an advertising campaign along with all other omitted factors. For example, the quality of the advertising campaign may matter just as much as the amount spent on it. By recursively substituting 212 C. R. Clark et al. for the lagged stocks of perceived quality and awareness we can write the current stocks as functions of all past advertising expenditures and the current and all past error terms. This shows that these shocks to brand awareness and perceived quality are persistent ov er time.For example, the effect of a particularly good (or bad) advertising campaign may linger and be felt for some time to come. We model the effect of competitors’ advertising on brand awareness and perceived quality in two ways. First, we consider a brand’s â€Å"share of voice. † We use its advertising expenditures, Eit? 1 , relative to the average amount spent on advertising by rival brands in the brand’s subcategory or category, E? it? 1 . 3 To the extent that brands compete with each other for the attention of consumers, a brand may have to outspend its rivals to cut through the clutter.If so, then what is important may not be the absolute amount spent on advertising but the amount relative to rival brands. Second, we consider the amount of advertising in the entire market by including the average amount spent on advertising by rival brands in the brand’s subcategory or category. Advertising is market expanding if it attracts consumers to t he entire category but not necessarily to a particular brand. In this way, competitors’ advertising may have a positive in? uence on, say, brand awareness. Taken together, our estimation equations are Qit = ? i + ? t + ? Qit? 1 + f (Eit? 1 , E? it? 1 ) + ? t , Ait = ? i + ? t + ? Ait? 1 + f (Eit? 1 , E? it? 1 ) + ? it . (1) (2) Here ? i is a brand effect that captures unobserved heterogeneity across brands and ? t is a time effect to control for possible systematic changes over time. The time effect may capture, for example, that consumers are systematically informed about a larger number of brands due to the advent of the internet and other alternative media channels. Through the brand effect we allow for factors other than advertising to affect a brand’s stocks of perceived quality and awareness to the extent that these factors are constant over time.For example, consumers may hear about a brand and their quality perceptions may be affected by word of mouth. Similarl y, it may well be the case that consumers in the process of purchasing a brand become more informed about it and that their quality perceptions change, especially for high-involvement brands. Prior to purchasing a car, say, many consumers engage in research about the set of available cars and their respective characteristics, including quality ratings from sources such as car magazines and Consumer Reports.If these effects do not vary over time, then we fully account for them in our estimation because the dynamic panel data methods we employ involve ? rst differencing. The parameter ? measures how much of last period’s stocks of perceived quality and awareness are carried forward into this period’s stocks; 1 ? ? can 3 The Brandweek Superbrands survey reports on only the top brands (in terms of sales) in each subcategory or category. The number of brands varies from 3 for some subcategories to 10 for others. We therefore use the average, rather than the sum, of competit ors’ advertising.Effect of advertising on brand awareness and perceived quality 213 therefore be interpreted as the rate of depreciation of these stocks. Note that in the estimation we allow all parameters to be different across our estimation equations. For example, we do not presume that the carryover rates for perceived quality and brand awareness are the same. The function f ( ·) represents the response of brand awareness and perceived quality to the advertising expenditures of the brand and potentially also those of its rivals. In the simplest case absent competition we specify this function as 2 f (Eit? ) = ? 1 Eit? 1 + ? 2 Eit? 1 . This functional form is ? exible in that it allows for a nonlinear effect of advertising expenditures but does not impose one. Later on in Section 5. 6 we demonstrate the robustness of our results by considering a number of additional functional forms. To account for competition in the share-of-voice speci? cation, we set f Eit? 1 , E? it? 1 = ? 1 Eit? 1 E? it? 1 + ? 2 Eit? 1 E? it? 1 2 and in the total-advertising speci? cation, we set 2 f Eit? 1 , E? it? 1 = ? 1 Eit? 1 + ? 2 Eit? 1 + ? 3 E? it? 1 . Estimation strategy Equations 1 and 2 are dynamic relationships that feature lagged dependent variables on the right-hand side. When estimating, we confront the problems of unobserved heterogeneity across brands and the endogeneity of advertising. In our panel-data setting, ignoring unobserved heterogeneity is akin to dropping the brand effect ? i from Eqs. 1 and 2 and then estimating them by ordinary least squares. Since this approach relies on both cross-sectional and time-series variation to identify the effect of advertising, we refer to it as â€Å"pooled OLS† (POLS) in what follows.To account for unobserved heterogeneity we include a brand effect ? i and use the within estimator that treats ? i as a ? xed effect. We follow the usual convention in microeconomic applications that the term â€Å"? xed effectâ €  does not necessarily mean that the effect is being treated as nonrandom; rather it means that we are allowing for arbitrary correlation between the unobserved brand effect and the observed explanatory variables (Wooldridge 2002, p. 251). The within estimator eliminates the brand effect by subtracting the within-brand mean from Eqs. 1 and 2. Hence, the identi? ation of the slope parameters that determine the effect of advertising relies solely on variation over time within brands; the information in the between-brand cross-sectional relationship is not used. We refer to this approach as â€Å"? xed effects† (FE). While FE accounts for unobserved heterogeneity, it suffers from an endogeneity problem. In our panel-data setting, endogeneity arises for two reasons. First, since Eqs. 1 and 2 are inherently dynamic, the lagged stocks of perceived 214 C. R. Clark et al. quality and awareness may be endogenous. More formally, Qit? 1 and Ait? 1 are by construction correlated with ? s for s < t. The within estimator subtracts the within-brand mean from Eqs. 1 and 2. The resulting regressor, say Qit? 1 ? Qi in the case of perceived quality, is correlated with the error term ? it ? ?i since ? i contains ? it? 1 along with all higher-order lags. Hence, FE is necessarily inconsistent. Second, advertising expenditures may also be endogenous for economic reasons. For instance, media coverage such as news reports may directly affect brand awareness and perceived quality. Our model treats media coverage other than advertising as shocks to the stocks of perceived quality and awareness.To the extent that these shocks feed back into decisions about advertising, say because the brand manager opts to advertise less if a news report has generated suf? cient awareness, they give rise to an endogeneity problem. More formally, it is reasonable to assume that Eit? 1 , the advertising expenditures of brand i over the course of period t ? 1, are chosen at the beginning of perio d t ? 1 with knowledge of ? it? 1 and higher-order lags and that therefore Eit? 1 is correlated with ? is for s < t. We apply the dynamic panel-data method proposed by Arellano and Bond (1991) to deal with both unobserved heterogeneity and endogeneity.This methodology has the advantage that it does not rely on the availability of strictly exogenous explanatory variables or instruments. This is welcome because instruments are often hard to come by, especially in panel-data settings: The problem is ? nding a variable that is a good predictor of advertising expenditures and is uncorrelated with shocks to brand awareness and perceived quality; ? nding a variable that is a good predictor of lagged brand awareness and perceived quality and uncorrelated with current shocks to brand awareness and perceived quality is even less obvious.The key idea of Arellano and Bond (1991) is that if the error terms are serially uncorrelated, then lagged values of the dependent variable and lagged values of the endogenous right-hand-side variables represent valid instruments. To see this, take ? rst differences of Eq. 1 to obtain Qit ? Qit? 1 = (? t ? ?t? 1 ) + ? (Qit? 1 ? Qit? 2 ) + f (Eit? 1 ) ? f (Eit? 2 ) + (? it ? ?it? 1 ), (3) where we abstract from competition to simplify the notation. Eliminating the brand effect ? i accounts for unobserved heterogeneity between brands. The remaining problem with estimating Eq. 3 by least-squares is that Qit? 1 ? Qit? is by construction correlated with ? it ? ?it? 1 since Qit? 1 is correlated with ? it? 1 by virtue of Eq. 1. Moreover, as we have discussed above, Eit? 1 may also be correlated with ? it? 1 for economic reasons. We take advantage of the fact that we have observations on a number of periods in order to come up with instruments for the endogenous variables. In particular, this is possible starting in the third period where Eq. 3 becomes Qi3 ? Qi2 = (? 3 ? ?2 ) + ? (Qi2 ? Qi1 ) + f (Ei2 ) ? f (Ei1 ) + (? i3 ? ?i2 ). Effect of adve rtising on brand awareness and perceived quality 215 In this case Qi1 is a valid instrument for (Qi2 ?Qi1 ) since it is correlated with (Qi2 ? Qi1 ) but uncorrelated with (? i3 ? ?i2 ) and, similarly, Ei1 is a valid instrument for ( f (Ei2 ) ? f (Ei1 )). In the fourth period Qi1 and Qi2 are both valid instruments since neither is correlated with (? i4 ? ?i3 ) and, similarly, Ei1 and Ei2 are both valid instruments. In general, for lagged dependent variables and for endogenous right-hand-side variables, levels of these variables that are lagged two or more periods are valid instruments. This allows us to generate more instruments for later periods. The resulting estimator is referred to as â€Å"difference GMM† (DGMM).A potential dif? culty with the DGMM estimator is that lagged levels may be poor instruments for ? rst differences when the underlying variables are highly persistent over time. Arellano and Bover (1995) and Blundell and Bond (1998) propose an augmented estimator in which the original equations in levels are added to the system. The idea is to create a stacked data set containing differences and levels and then to instrument differences with levels and levels with differences. The required assumption is that brand effects are uncorrelated with changes in advertising expenditures.This estimator is commonly referred to as â€Å"system GMM† (SGMM). In Section 5 we report and compare results for DGMM and SGMM. It is important to test the validity of the instruments proposed above. Following Arellano and Bond (1991) we report a Hansen J test for overidentifying restrictions. This test examines whether the instruments are jointly exogenous. We also report the so-called difference-in-Hansen J test to examine speci? cally whether the additional instruments for the level equations used in SGMM (but not in DGMM) are valid. Arellano and Bond (1991) further develop a test for second-order serial correlation in the ? st differences of the error te rms. As described above, both GMM estimators require that the levels of the error terms be serially uncorrelated, implying that the ? rst differences are serially correlated of at most ? rst order. We caution the reader that the test for second-order serial correlation is formally only de? ned if the number of periods in the sample is greater than or equal to 5 whereas we observe a brand on average for just 4. 2 periods in our application. Our preliminary estimates suggest that the error terms are unlikely to be serially uncorrelated as required by Arellano and Bond (1991).The AR(2) test described above indicates ? rst-order serial correlation in the error terms. An AR(3) test for third-order serial correlation in the ? rst differences of the error terms, however, indicates the absence of second-order serial correlation in the error terms. 4 In this case, Qit? 2 and Eit? 2 are no longer valid instruments for Eq. 3. Intuitively, because Qit? 2 is correlated with ? it? 2 by virtue of Eq. 1 and ? it? 2 is correlated with ? it? 1 by ? rst-order serial correlation, Qit? 2 is correlated 4 Of course, the AR(3) test uses less observations than the AR(2) test and is therefore also less powerful. 16 C. R. Clark et al. with ? it? 1 in Eq. 3, and similarly for Eit? 2 . Fortunately, however, Qit? 3 and Eit? 3 remain valid instruments because ? it? 3 is uncorrelated with ? it? 1 . We carry out the DGMM and SGMM estimation using STATA’s xtabond2 routine (Roodman 2007). We enter third and higher lags of either brand awareness or perceived quality, together with third and higher lags of advertising expenditures as instruments. In addition to these â€Å"GMM-style† instruments, for the difference equations we enter the time dummies as â€Å"IV-style† instruments. We also apply the ? ite-sample correction proposed by Windmeijer (2005) which corrects for the two-step covariance matrix and substantially increases the ef? ciency of both GMM estimators. Finally, we compute standard errors that are robust to heteroskedasticity and arbitrary patterns of serial correlation within brands. 4 Data Our data are derived from the Brandweek Superbrands surveys from 2000 to 2005. Each year’s survey lists the top brands in terms of sales during the past year from 25 broad categories. Inside these categories are often a number of more narrowly de? ned subcategories. Table 1 lists the categories along with their subcategories.The surveys report perceived quality and awareness scores for the current year and the advertising expenditures for the previous year by brand. Perceived quality and awareness scores are calculated by Harris Interactive in their Equitrend brand-equity study. Each year Harris Interactive surveys online between 20, 000 and 45, 000 consumers aged 15 years and older in order to determine their perceptions of a brand’s quality and its level of awareness for approximately 1, 000 brands. 5 To ensure that the respondents accu rately re? ect the general population their responses are propensity weighted. Each respondent rates around 80 of these brands.Perceived quality is measured on a 0–10 scale, with 0 meaning unacceptable/poor and 10 meaning outstanding/ extraordinary. Awareness scores vary between 0 and 100 and equal the percentage of respondents that can rate the brand’s quality. The quality rating is therefore conditional on the respondent being aware of the brand. 6 5 The exact wording of the question is: â€Å"We will display for you a list of brands and we are asking you to rate the overall quality of each brand using a 0 to 10 scale, where ‘0’ means ‘Unacceptable/Poor Quality’, ‘5’ means ‘Quite Acceptable Quality’ and ‘10’ means ‘Outstanding/ Extraordinary Quality’.You may use any number from 0 to 10 to rate the brands, or use 99 for ‘No Opinion’ option if you have absolutely no opinion abou t the brand. † Panelists are being incentivized through sweepstakes on a periodic basis but are not paid for a particular survey. 6 The 2000 Superbrands survey does not separately report perceived quality and salience scores. We received these scores directly from Harris Interactive. 2000 is the ? rst year for which we have been able to obtain perceived quality and salience scores for a large number of brands.Starting with the 2004 and 2005 Superbrands surveys, salience is replaced by a new measure called â€Å"familiarity. † For these two years we received salience scores directly from Harris Interactive. The contemporaneous correlation between salience and familiarity is 0. 98 and signi? cant with a p-value of 0. 000. Effect of advertising on brand awareness and perceived quality Table 1 Categories and subcategories 1. Apparel 2. Appliances 3. Automobiles a. general automobiles b. luxury c. subcompact d. sedan/wagon e. trucks/suvs/vans 4. Beer, wine, liquor a. beer b. wine c. malternatives d. iquor 5. Beverages a. general b. new age/sports/water 6. Computers a. software b. hardware 7. Consumer electronics 8. Cosmetics and fragrances a. color cosmetics b. eye color c. lip color d. women’s fragrances e. men’s fragrances 9. Credit cards 10. Entertainment 11. Fast food 12. Financial services 13. Food a. ready to eat cereal b. cereal bars c. cookies d. cheese e. crackers f. salted snacks g. frozen dinners and entrees Items in italics have been removed 217 h. frozen pizza i. spaghetti sauce j. coffee k. ice cream l. refrigerated orange juice m. refrigerated yogurt n. oy drinks o. luncheon meats p. meat alternatives q. baby formula/electrolyte solutions r. pourable salad dressing 14. Footwear 15. Health and beauty a. bar soap b. toothpaste c. shampoo d. hair color 16. Household a. cleaner b. laundry detergents c. diapers d. facial tissue e. toilet tissue f. automatic dishwater detergent 17. Petrol a. oil companies b. automotive aftercare/ lube 18. Pharmaceutical OTC a. allergy/cold medicine b. stomach/antacids c. analgesics 19. Pharmaceutical prescription 20. Retail 21. Telecommunications 22. Tobacco 23. Toys 24. Travel 25. World Wide WebWe supplement the awareness and quality measures with advertising expenditures that are taken from TNS Media Intelligence and Competitive Media Reporting. These advertising expenditures encompass spending in a wide range of media: Magazines (consumer magazines, Sunday magazines, local magazines, and business-to-business magazines), newspaper (local and national newspapers), television (network TV, spot TV, syndicated TV, and network cable TV), radio (network, national spot, and local), Spanish-language media (magazines, newspapers, and TV networks), internet, and outdoor.After eliminating categories and subcategories where observations are not at the brand level (apparel, entertainment, ? nancial services, retail, world wide web) or where the data are suspect (tobacco), we are left w ith 19 categories (see again Table 1). We then drop all private labels and all brands for which 218 C. R. Clark et al. we do not have perceived quality and awareness scores as well as advertising expenditures for at least two years running. This leaves us with 348 brands. Table 2 contains descriptive statistics for the overall sample and also by category. In the overall sample the average awareness score is 69. 5 and the average perceived quality score is 6. 36. The average amount spent on advertising is around $66 million per year. There is substantial variation in these measures across categories. The variation in perceived quality (coef? cient of variation is 0. 11 overall, ranging from 0. 04 for appliances to 0. 13 for computers) tends to be lower than the variation in brand awareness (coef? cient of variation is 0. 28 overall, ranging from 0. 05 for appliances to 0. 46 for telecommunications), in line with the fact the quality rating is conditional on the respondent being aware of the brand.The contemporaneous correlation between brand awareness and perceived quality is 0. 60 and signi? cant with a p-value of 0. 000. The contemporaneous correlation between advertising expenditures and the change in brand awareness is 0. 0488 and signi? cant with a p-value of 0. 0985 and the contemporaneous correlation between advertising expenditures and the change in perceived quality is 0. 0718 and signi? cant with a p-value of 0. 0150. These correlations anticipate the spurious correlation between both brand awareness and perceived quality and advertising expenditures if permanent differences between brands are neglected (POLS estimator).We will see though that the effect of advertising expenditures on perceived quality Table 2 Descriptive statistics # obs # brands Brand awareness Perceived Advertising (0–100) quality (0–10) ($1,000,000) Mean Std. dev. Mean Std. dev. Mean Std. dev. Overall Appliances Automobiles Beer, wine, liquor Beverages Computers Cons umer electronics Cosmetics and fragrances Credit cards Fast food Food Footwear Health and beauty Household Petrol Pharmaceutical OTC Pharmaceutical prescription Telecommunications Toys Travel 1,478 348 21 137 98 95 79 29 70 29 60 247 38 54 128 48 56 31 52 25 181 4 30 24 22 17 7 19 6 12 65 8 11 31 13 15 10 11 5 38 69. 5 85. 09 67. 81 62. 23 84. 57 59. 80 67. 83 49. 37 70. 97 93. 83 80. 18 64. 95 82. 50 73. 83 60. 52 76. 96 29. 97 49. 33 72. 12 59. 48 19. 43 4. 54 6. 72 10. 13 13. 84 23. 05 18. 68 15. 75 18. 08 5. 32 14. 94 18. 98 9. 80 16. 03 17. 19 13. 89 9. 69 22. 86 9. 74 15. 43 6. 36 7. 35 6. 51 5. 68 6. 51 6. 41 6. 60 5. 83 6. 24 6. 28 6. 66 6. 39 6. 67 6. 66 5. 95 6. 79 5. 54 5. 28 6. 95 6. 26 0. 70 0. 32 0. 59 0. 72 0. 58 0. 81 0. 73 0. 52 0. 73 0. 42 0. 65 0. 42 0. 41 0. 56 0. 30 0. 37 0. 67 0. 52 0. 32 0. 52 66. 21 118. 52 41. 87 33. 19 99. 85 64. 62 36. 78 45. 11 41. 33 42. 19 130. 43 130. 7 104. 83 160. 66 38. 02 47. 48 174. 54 109. 77 214. 80 156. 23 13. 93 13. 81 40. 27 46. 89 27. 28 33. 44 21. 80 25. 43 33. 54 34. 65 38. 71 18. 13 76. 23 36. 40 367. 93 360. 54 108. 55 54. 36 25. 41 25. 88 Effect of advertising on brand awareness and perceived quality 219 disappears once unobserved heterogeneity is accounted for (FE and GMM estimators). The intertemporal correlation is 0. 98 for brand awareness, 0. 95 for perceived quality, and 0. 93 for advertising expenditures. This limited amount of intertemporal variation warrants preferring the SGMM over the DGMM estimator.At the same time, however, it constrains how ? nely we can â€Å"slice† the data, e. g. , by isolating a brand-speci? c effect of advertising expenditures on brand awareness and perceived quality. Since the FE, DGMM, and SGMM estimators rely on within-brand acrosstime variation, it is important to ensure that there is a suf? cient amount of within-brand variation in brand awareness, perceived quality, and advertising expenditures. Table 3 presents a decomposition of the standard devia tion in these variables into an across-brands and a within-brand component for the overall sample and also by category.The across-brands standard deviation is a measure of the cross-sectional variation and the within-brand standard deviation is a measure of the time-series variation. The across-brands standard deviation of brand awareness is about six times larger than the within-brand standard deviation. This ratio varies across categories and ranges from 2 for automobiles, beer, wine, liquor, and pharmaceutical prescription to 6 for health and beauty and pharmaceutical OTC. In case of perceived quality the ratio is about 4 (ranging from 1 for telecommunications to 5 for consumer electronics, credit cards, and household).Hence, while there is more crosssectional than time-series variation in our sample, the time-series variation is substantial for both brand awareness and perceived quality. Figure 1 illustrates Table 3 Variance decomposition Brand awareness (0–100) Across Ov erall Appliances Automobiles Beer, wine, liquor Beverages Computers Consumer electronics Cosmetics and fragrances Credit cards Fast food Food Footwear Health and beauty Household Petrol Pharmaceutical OTC Pharmaceutical prescription Telecommunications Toys Travel 20. 117 5. 282 6. 209 10. 181 13. 435 23. 094 19. 952 18. 054 19. 568 6. 132 16. 241 20. 417 10. 36 16. 719 20. 179 13. 339 9. 393 21. 659 11. 217 16. 063 Within 3. 415 1. 334 3. 281 4. 105 2. 915 3. 843 5. 611 3. 684 3. 903 1. 660 2. 255 4. 267 1. 772 3. 896 3. 669 2. 363 5. 772 5. 604 3. 589 3. 216 Perceived quality (0–10) Across 0. 726 0. 323 0. 561 0. 705 0. 582 0. 850 0. 800 0. 563 0. 788 0. 361 0. 702 0. 388 0. 397 0. 561 0. 415 0. 336 0. 753 0. 452 0. 360 0. 516 Within 0. 176 0. 148 0. 141 0. 186 0. 190 0. 313 0. 167 0. 208 0. 159 0. 202 0. 134 0. 167 0. 136 0. 113 0. 116 0. 129 0. 230 0. 334 0. 127 0. 153 Advertising ($1,000,000) Across 100. 823 28. 965 54. 680 41. 713 37. 505 110. 362 105. 49 38. 446 118. 05 9 159. 306 15. 655 45. 791 27. 054 18. 789 27. 227 16. 325 38. 648 317. 434 61. 419 22. 136 Within 43. 625 21. 316 32. 552 12. 406 13. 372 65. 909 114. 381 20. 053 43. 415 33. 527 7. 998 7. 640 19. 075 16. 672 20. 496 9. 080 27. 919 178. 406 18. 584 10. 909 220 .025 . 2 C. R. Clark et al. .02 Density . 01 . 015 0 .005 0 20 40 60 80 Mean brand awareness 100  ® 0 –30 .05 Density . 1 .15 –20 –10 0 10 20 Demeaned brand awareness 30  ® .8 .6 Density . 4 0 .2 0 2 4 6 Mean perceived quality 8 10  ® 0 –1. 5 1 Density 2 3 –1 –. 5 0 . 5 1 Demeaned perceived quality 1. 5  ® .015 Density . 005 . 01 0 0 00 400 600 800 1000 1200 1400 Mean advertising expenditures (millions of $)  ® 0 –600 –400 –200 0 200 400 600 Demeaned advertising expenditures (millions of $)  ® Fig. 1 Variance decomposition. Histogram of brand-mean of brand awareness, perceived quality, and advertising expenditures (left panels) and histogram of de-mean ed brand awareness, perceived quality, and advertising expenditures (right panels) the decomposition for the overall sample. The left panels show histograms of the brand-mean of brand awareness, perceived quality, and advertising expenditures and the right panels show histograms of the de-meaned variables.Again it is evident that the time-series variation is substantial for both brand awareness and perceived quality. 5 Empirical results In Tables 4 and 5 we present a number of different estimates for the effect of advertising expenditures on brand awareness and perceived quality, .005 Density . 01 . 015 .02 .025 Effect of advertising on brand awareness and perceived quality Table 4 Brand awareness POLS Lagged brand awareness Advertising Advertising2 Marginal effect of advertising at: Mean 25th pctl. 50th pctl. 75th pctl. Advertising test: ? 1 = ? 2 = 0 Speci? ation tests: Hansen J Difference-in-Hansen J Arellano & Bond AR(2) Arellano & Bond AR(3) Goodness of ? t measures: R2 -within R2 -between R2 # obs # brands FE DGMM SGMM 221 0. 942*** 0. 223*** 0. 679*** 0. 837*** (0. 00602) (0. 0479) (0. 109) (0. 0266) 0. 00535*** 0. 00687 0. 0152 0. 00627** (0. 00117) (0. 00443) (0. 0139) (0. 00300) ? 0. 00000409*** ? 0. 00000139 ? 0. 0000105 ? 0. 00000524** (0. 000000979) (0. 00000332) (0. 00000745) (0. 00000239) 0. 00481*** (0. 00107) 0. 00527*** (0. 00116) 0. 00514*** (0. 00113) 0. 00470*** (0. 00105) Reject*** 0. 00668 (0. 00412) 0. 00684 (0. 00438) 0. 00679 (0. 00430) 0. 00664 (0. 0405) 0. 0138 (0. 0129) 0. 0150 (0. 0138) 0. 0147 (0. 0135) 0. 0136 (0. 00127) 0. 00558** (0. 00269) 0. 00617** (0. 00296) 0. 00600** (0. 00288) 0. 00544** (0. 00263) Do not reject Do not reject Reject* Do not reject Do not reject Reject** Reject** Do not reject Do not reject 0. 494 0. 940 0. 851 1,148 317 Reject*** 0. 969 1,148 317 819 274 1,148 317 Standard errors in parenthesis * p = 0. 10; ** p = 0. 05; *** p = 0. 01 respectively. Starting with the simplest case absent competition, we present estimates of ? , ? 1 , and ? 2 (the coef? cients on Qit? 1 or Ait? 1 and Eit? 1 and 2 Eit? 1 ) along with the marginal effect ? 1 + 2? Eit? 1 calculated at the mean and the 25th, 50th, and 75th percentiles of advertising expenditures. The POLS estimates in the ? rst column of Tables 4 and 5 suggest a signi? cant positive effect of advertising expenditures on both brand awareness and perceived quality. In both cases we also reject the null hypothesis that advertising plays no role in determining brand awareness and perceived quality (? 1 = ? 2 = 0). Of course, as mentioned above, POLS accounts for neither unobserved heterogeneity nor endogeneity. In the next columns of Tables 4 and 5 we present FE, DGMM, and SGMM estimates that attend to these issues. 7 7 The stimates use at most 317 out of 348 brands because we restrict the sample to brands with data for two years running but use third and higher lags of brand awareness respectively perceived quality and advertising expendit ures as instruments. Different sample sizes are reported for the DGMM and SGMM estimators. Sample size is not a well-de? ned concept in SGMM since this estimator essentially runs on two different samples simultaneously. The xtabond2 routine in STATA reports the size of the transformed sample for DGMM and of the untransformed sample for SGMM. 222 Table 5 Perceived quality FE 0. 391*** (0. 0611) 0. 659*** (0. 204) 1. 47*** (0. 0459) 0. 981*** (0. 0431) DGMM SGMM Objective quality Brand awareness POLS Lagged perceived quality 0. 970*** (0. 0110) Brand awareness Advertising Advertising2 0. 000218** (0. 0000952) ? 0. 000000133 (0. 000000107) 0. 0000822 (0. 000198) 0. 0000000408 (0. 000000162) ?0. 0000195 (0. 000969) 0. 000000108 (0. 000000945) 0. 0000219 (0. 000205) 0. 0000000571 (0. 000000231) 0. 0000649 (0. 000944) 0. 0000000807 (0. 00000308) 0. 937*** (0. 0413) 0. 00596*** (0. 00165) ? 0. 000298 (0. 000256) 0. 000000319 (0. 000000267) Marginal effect of advertising at: Mean 25th pctl. 50th pctl. 75th pctl. 0. 0002** (0. 0000819) 0. 000215** (0. 000933) 0. 000211** (0. 00009) 0. 0001965** (0. 0000793) Do not reject Do not reject Reject*** Do not reject Do not reject Do not reject Reject** Reject** Reject*** Do not reject 0. 0000877 (0. 000180) 0. 000083 (0. 000195) 0. 0000844 (0. 000191) 0. 0000887 (0. 000177) ?5. 13e? 06 (0. 000848) ? 0. 0000174 (0. 000952) ? 0. 0000139 (0. 000922) ? 2. 32e? 06 (0. 000825) 0. 0000295 (0. 000176) 0. 0000230 (0. 000201) 0. 0000249 (0. 000194) 0. 0000310 (0. 000170) 0. 0000594 (0. 000740) 0. 0000642 (0. 000917) 0. 0000623 (0. 000847) 0. 0000588 (0. 000714) Do not reject Do not reject Do not reject Reject*** Do not reject ?0. 000256 (0. 000222) ? 0. 00292 (0. 000251) ? 0. 000282 (0. 000242) ? 0. 000248 (0. 000215) Do not reject Reject** Do not reject Reject*** Do not reject Advertising test: ? 1 = ? 2 = 0 Speci? cation tests: Hansen J Difference-in-Hansen J Arellano & Bond AR(2) Arellano & Bond AR(3) Goodness of ? t measures: R2 -wi thin R2 -between R2 # obs # brands 0. 180 0. 952 0. 909 1,148 317 819 274 1,148 317 Reject** 0. 914 1,148 317 604 178 1,148 317 C. R. Clark et al. Standard errors in parenthesis. SGMM estimates in columns labeled â€Å"Objective quality† and â€Å"Brand awareness† * p = 0. 10; ** p = 0. 05; *** p = 0. 01 Effect of advertising on brand awareness and perceived quality 23 Regardless of the class of estimator we ? nd a signi? cant positive effect of advertising expenditures on brand awareness. With the FE estimator we ? nd that the marginal effect of advertising on awareness at the mean is 0. 00668. It is borderline signi? cant with a p-value of 0. 105 and implies an elasticity of 0. 00638 (with a standard error of 0. 00392). A one-standard-deviation increase of advertising expenditures increase brand awareness by 0. 0408 standard deviations (with a standard error of 0. 0251). The rate of depreciation of a brand’s stock of awareness is estimated to be 1–0. 22 3 or 78% per year.The FE estimator identi? es the effect of advertising expenditures on brand awareness solely from the within-brand across-time variation. The problem with this estimator is that it does not deal with the endogeneity of the lagged dependent variable on the right-hand side of Eq. 2 and the potential endogeneity of advertising expenditures. We thus turn to the GMM estimators described in Section 3. We focus on the more ef? cient SGMM estimator. The coef? cient on the linear term in advertising expenditures is estimated to be 0. 00627 ( p-value 0. 037) and the coef? cient on the quadratic term is estimated to be ? . 00000524 ( p-value 0. 028). These estimates support the hypothesis that the relationship between advertising and awareness is nonlinear. The marginal effect of advertising on awareness is estimated to be 0. 00558 ( p-value 0. 038) at the mean and implies an elasticity of 0. 00533 (with a standard error of 0. 00257). A one-standard-deviation increase of adve rtising expenditures increases brand awareness by 0. 0340 standard deviations (with a standard error of 0. 0164). The rate of depreciation decreases substantially after correcting for endogeneity and is estimated to be 1? . 828 or 17% per year, thus indicating that an increase in a brand’s stock of awareness due to an increase in advertising expenditures persists for years to come. The Hansen J test for overidentifying restrictions indicates that the instruments taken together as a group are valid. Recall from Section 3 that we must assume that an extra condition holds in order for the SGMM estimator to be appropriate. The difference-in-Hansen J test con? rms that it does, as we cannot reject the null hypothesis that the additional instruments for the level equations are valid.While we reject the hypothesis of no second-order serial correlation in the error terms, we cannot reject the hypothesis of no thirdorder serial correlation. This result further validates our instrument ing strategy. However, one may still be worried about the SGMM estimates because DGMM uses a strict subset of the orthogonality conditions of SGMM and we reject the Hansen J test for the DGMM estimates (see Table 4). From a formal statistical point of view, rejecting the smaller set of orthogonality conditions in DGMM is not conclusive evidence that the larger set of orthogonality conditions in SGMM are invalid (Hayashi 2000, pp. 18–221). In Fig. 2 we plot the marginal effect of advertising expenditures on brand awareness over the entire range of advertising expenditures for our SGMM estimates along with a histogram of advertising expenditures. For advertising expenditures between $400 million and $800 million per year the marginal effect of advertising on awareness is no longer signi? cantly different from zero 224 C. R. Clark et al. Marginal effect –. 004 0 . 004 0 200 400 600 800 1000 Advertising expenditures (millions of $) 1200 1400 arginal effect of advertising l ower 90% confidence limit . 015 upper 90% confidence limit 0 0 .005 Density . 01 200 400 600 800 1000 Advertising expenditures (millions of $) 1200 1400  ® Fig. 2 Pointwise con? dence interval for the marginal effect of advertising expenditures on brand awareness (upper panel) and histogram of advertising expenditures (lower panel). SGMM estimates and, statistically, it is actually negative for very high advertising expenditures over $800 million per year. The former case covers around 1. 9% of observations and the latter less than 0. 5%.One possible interpretation is that brands with very high current advertising expenditures are those that are already wellknown (perhaps because they have been heavily advertised over the years), so that advertising cannot further boost their awareness. Indeed, average awareness for observations with over $400 million in advertising expenditures is 74. 94 as compared to 69. 35 for the entire sample. Turning from brand awareness in Table 4 to perce ived quality in Table 5, we see that the positive effect of advertising expenditures on perceived quality found by the POLS estimator disappears once unobserved eterogeneity is accounted by the FE, DGMM, and SGMM estimators. In fact, we cannot reject the null hypothesis that advertising plays no role in determining perceived quality. Figure 3 graphically illustrates the absence of an effect of advertising expenditures on perceived quality at the margin for our DGMM estimates. While the effect of advertising expenditures on perceived quality is very imprecisely estimated, it appears to be economically insigni? cant: The implied elasticity is ? 0. 0000534 (with a standard error of 0. 00883) and a one-standarddeviation increase of advertising expenditures decrease perceived quality byEffect of advertising on brand awareness and perceived quality 225 Marginal effect –. 001 0 . 001 0 200 400 600 800 1000 Advertising expenditures (millions of $) 1200 1400 marginal effect of adverti sing lower 90% confidence limit . 015 upper 90% confidence limit 0 0 Density . 005 . 01 200 400 600 800 1000 Advertising expenditures (millions of $) 1200 1400  ® Fig. 3 Pointwise con? dence interval for the marginal effect of advertising expenditures on perceived quality (upper panel) and histogram of advertising expenditures (lower panel). DGMM estimates 0. 000869 standard deviations (with a standard error of 0. 44). Note that the comparable effects for brand awareness are two orders of magnitude larger. Much of the remainder of this paper is concerned with demonstrating the robustness of this negative result. Before proceeding we note that whenever possible we focus on the more ef? cient SGMM estimator. Unfortunately, for perceived quality in many cases, including that in the fourth column of Table 5, the difference-in-Hansen J test rejects the null hypothesis that the extra moments in the SGMM estimator are valid. In these cases we focus on the DGMM estimator. 5. Objective and perceived quality An important component of a brand’s perceived quality is its objective quality. To the extent that objective quality remains constant, it is absorbed into the brand effects. But, even though the time frame of our sample is not very long, it is certainly possible that the objective quality of some brands has changed over the course of our sample. If so, then the lack of an effect of advertising expenditures on perceived quality may be explained if brand managers increase advertising expenditures to compensate for decreases in objective 26 C. R. Clark et al. quality. To the extent that increased advertising expenditures and decreased objective quality cancel each other out, their net effect on perceived quality may be zero. The dif? culty with testing this alternative explanation is that we do not have data on objective quality. We therefore exclude from the analysis those categories with brands that are likely to undergo changes in objective quality (applian ces, automobiles, computers, consumer electronics, fast food, footwear, pharmaceutical OTC, telecommunications, toys, and travel).The resulting estimates are reported in Table 5 under the heading â€Å"Objective quality. † We still ? nd no effect of advertising expenditures on perceived quality. 8 5. 2 Variation in perceived quality Another possible reason for the lack of an effect of advertising expenditures on perceived quality is that perceived quality may not vary much over time. This is not the case in our data. Indeed, the standard deviation of the year-to-year changes in perceived quality is 0. 2154. Even for those products whose objective quality does not change over time there are important changes in perceived quality (standard deviation 0. 130). For example, consider bottled water where we expect little change in objective quality over time, both within and across brands. Nonetheless, there is considerable variation in perceived quality. The perceived quality of Aq ua? na Water ranges across years from 6. 33 to 6. 90 and that of Poland Spring Water from 5. 91 to 6. 43, so the equivalent of over two standard deviations. Across the brands of bottled water the range is from 5. 88 to 6. 90, or the equivalent of over four standard deviations. Further evidence of variation in perceived quality is provided by the automobiles category.Here we have obtained measures of objective quality from Consumer Reports that rate vehicles based on their performance, comfort, convenience, safety, and fuel economy. We can ? nd examples of brands whose objective quality does not change at least for a number of years while their perceived quality ? uctuates considerably. For example, Chevy Silverado’s objective quality does not change between 2000 and 2002, but its perceived quality increases from 6. 08 to 6. 71 over these three years. Similarly, GMC Sierra’s objective quality does not change between 2001 and 2003, but its perceived quality decreases fro m 6. 72 to 6. 26. The ? al piece of evidence that we have to offer is the variance decomposition from Section 4 (see again Table 3 and Fig. 1). Recall that the acrossbrands standard deviation of brand awareness is about six times larger than the within-brand standard deviation. In case of perceived quality the ratio is about 4. Hence, while there is more cross-sectional than time-series variation in our sample, the time-series variation is substantial for both brand aware- 8 The marginal effects are calculated at the mean, 25th, 50th, and 75th percentile for advertising for the brands in the categories judged to be stable in terms of objective quality over time.Effect of advertising on brand awareness and perceived quality 227 ness and perceived quality. Also recall from Section 4 that perceived quality with an intertemporal correlation of 0. 95 is somewhat less persistent than brand awareness with an intertemporal correlation of 0. 98. Given that we are able to detect an effect of advertising expenditures on brand awareness, it seems unlikely that insuf? cient variation within brands can explain the lack of an effect of advertising expenditures on perceived quality; instead, our results suggest that the variation in perceived quality is unrelated to advertising expenditures.The question then becomes what besides advertising may drive these changes in perceived quality. There are numerous possibilities, including consumer learning and word-of-mouth effects. Unfortunately, given the data available to us, we cannot further explore these possibilities. 5. 3 Brand awareness and perceived quality Another concern is that consumers may confound awareness and preference. That is, consumers may simply prefer more familiar brands over less familiar ones (see Zajonc 1968). To address this issue we proxy for consumers’ familiarity by adding brand awareness to the regression for perceived quality.The resulting estimates are reported in Table 5 under the heading â₠¬Å"Brand awareness. † While there is a signi? cant positive relationship between brand awareness and perceived quality, there is still no evidence of a signi? cant positive effect of advertising expenditures on perceived quality. 5. 4 Competitive effects Advertising takes place in a competitive environment. Most of the industries being studied here are indeed oligopolies, which suggests that strategic considerations may in? uence advertising decisions.We next allow a brand’s stocks of awareness and perceived quality to be affected by the advertising of its competitors as discussed in Section 2. 9 Competitors’ advertising, in turn, can enter our estimation Eqs. 1 and 2 either relative in the share-of-voice speci? cation or absolute in the total-advertising speci? cation. We report the resulting estimates in Table 6. Somewhat surprisingly, the share-of-voice speci? cation yields an insignificant effect of own advertising. We conclude that the share-of-voice speci? cation is simply not an appropriate functional form in our application. The total-advertising speci? ation readily con? rms our main ? ndings presented above that own advertising affects brand awareness but not perceived quality. This is true even if we allow competitors’ advertising to enter quadratically in 9 For this analysis we take the subcategory rather than the category as the relevant competitive environment. Consider for instance the beer, wine, liquor category. There is no reason to expect the advertising expenditures of beer brands to affect the perceived quality or awareness of liquor brands. We drop any subcategory in any year where there is just one brand due to the lack of competitors.Table 6 Competitive effects Perceived quality 0. 845*** (0. 0217) 0. 356** (0. 145) Total advertising Brand awareness Perceived quality 228 Share of voice Brand awareness Lagged awareness/quality Relative advertising (Relative advertising)2 0. 872*** (0. 0348) 0. 236 (0. 170) ? 0. 00912 (0. 0104) 1. 068*** (0. 0406) 0. 0168 (0. 0164) ? 0. 00102 (0. 00132) Advertising Advertising2 Competitors’ advertising 0. 00892** (0. 00387) ? 0. 00000602** (0. 00000248) ? 0. 00609* (0. 00363) ?0. 0000180 (0. 000592) ? 0. 0000000303 (0. 000000535) 0. 00128** (0. 000515) Marginal effect of advertising at: Mean 5th pctl. 50th pctl. 75th pctl. 0. 00333 (0. 00239) 0. 0164 (0. 01218) 0. 00624 (0. 00448) 0. 00264 (0. 00190) Do not reject Reject* Do not reject Reject*** Do not reject 1,147 317 0. 000225 (0. 000218) 0. 00113 (0. 00110) 0. 00429 (0. 000416) 0. 000179 (0. 000173) 0. 00812** (0. 00355) 0. 00881** (0. 00382) 0. 00861** (0. 00375) 0. 00797** (0. 00349) Reject** Do not reject Do not reject Reject** Do not reject 1,147 317 ?0. 000140 (0. 000524) ? 0. 0000174 (0. 000582) ? 0. 0000164 (0. 000565) ? 0. 0000132 (0. 000510) Do not reject Do not reject Reject*** Do not reject 1,147 317 C. R. Clark et al.Advertising test: ? 1 = ? 2 = 0 Speci? cation tests: Hansen J Differ ence-in-Hansen J Arellano & Bond AR(2) Arellano & Bond AR(3) # obs # brands Do not reject Do not reject Do not reject Reject** Do not reject 1,147 317 Standard errors in parenthesis. DGMM estimates in column labeled â€Å"Total advertising/perceived quality† and SGMM estimates otherwise * p = 0. 10; ** p = 0. 05; *** p = 0. 01 Effect of advertising on brand awareness and perceived quality 229 addition to linearly. Competitors’ advertising has a signi? cant negative effect on brand awareness and a signi? cant positive effect on perceived quality.Repeating the analysis using the sum instead of the average of competitors’ advertising yields largely similar results except that the share-of-voice speci? cation yields a signi? cant negative effect of advertising on brand awareness, thereby reinforcing our conclusion that this is not an appropriate functional form. 10 Overall, the inclusion of competitors’ advertising does not seem to in? uence our results about the role of own advertising on brand awareness and perceived quality. This justi? es our focus on the simple model without competition. Moreover, it suggests that the following alternative explanation for our main ? dings presented above is unlikely. Suppose awareness depended positively on the total amount of advertising in the brand’s subcategory or category while perceived quality depended positively on the brand’s own advertising but negatively on competitors’ advertising. Then the results from the simple model without competition could be driven by an omitted variables problem: If the brand’s own advertising is highly correlated with competitors’ advertising, then we would overstate the impact of advertising on awareness and understate the impact on perceived quality.In fact, we might ? nd no impact of advertising on perceived quality at all if the brand’s own advertising and competitors’ advertising cancel each other out. 5. 5 Category-speci? c effects Perhaps the ideal data for analyzing the effect of advertising are time series of advertising expenditures, brand awareness, and perceived quality for the brands being studied. With long enough time series we could then try to identify for each brand in isolation the effect of advertising expenditures on brand awareness and perceived quality.Since such time series are unfortunately not available, we have focused so far on the aggregate effect of advertising expenditures on brand awareness and perceived quality, i. e. , we have constrained the slope parameters in Eqs. 1 and 2 that determine the effect of advertising to be the same across brands. Similarly, we have constrained the carryover parameters in Eqs. 1 and 2 that determine the effect of lagged perceived quality and brand awareness respectively to be the same across brands. As a compromise between the two extremes of brands in isolation versus all brands aggregated, we ? st examine the effect of adver tising in different categories. This adds some cross-sectional variation across the brands within a 10 We caution the reader against reading too much into these results: The number and identity of the brands within a subcategory or category varies sometimes widely from year to year in the Brandweek Superbrands surveys. Thus, the sum of competitors’ advertising is an extremely volatile measure of the competitive environment. Moreover, the number of brands varies from 3 for some subcategories to 10 for others, thus making the sum of competitors’ advertising dif? ult to compare across subcategories. 230 Table 7 Category-speci? c effects Brand awareness Marginal effect Carryover rate Appliances Automobiles Beer, wine, liquor Beverages Computers Consumer electronics Cosmetics and fragrances Credit cards Fast food Food Footwear Health and beauty Household Petrol Pharmaceutical OTC Pharmaceutical prescription Telecommunications Toys Travel 0. 0233 (0. 0167) 0. 00526 (0. 0154) ? 0. 0264 (0. 0423) ? 0. 0245 (0. 0554) 0. 0193** (0. 00777) 0. 0210** (0. 0

Deception Point Page 53

THUD. THUD. THUD. THUD†¦ THUD†¦ THUD†¦ THUD. THUD. THUD. â€Å"There's†¦ no time†¦ † Tolland said. It's not†¦ about us, she thought. It's about the information in my pocket. Rachel pictured the incriminating GPR printout inside the Velcro pocket of her Mark IX suit. I need to get the GPR printout into the hands of the NRO†¦ and soon. Even in her delirious state, Rachel was certain her message would be received. In the mid-eighties, the NRO had replaced the SAA with an array thirty times as powerful. Total global coverage: Classic Wizard, the NRO's $12 million ear to the ocean floor. In the next few hours the Cray supercomputers at the NRO/NSA listening post in Menwith Hill, England, would flag an anomalous sequence in one of the Arctic's hydrophones, decipher the pounding as an SOS, triangulate the coordinates, and dispatch a rescue plane from Thule Air Force Base in Greenland. The plane would find three bodies on an iceberg. Frozen. Dead. One would be an NRO employee†¦ and she would be carrying a strange piece of thermal paper in her pocket. A GPR printout. Norah Mangor's final legacy. When the rescuers studied the printout, the mysterious insertion tunnel beneath the meteorite would be revealed. From there, Rachel had no idea what would happen, but at least the secret would not die with them here on the ice. 60 Every president's transition into the White House involves a private tour of three heavily guarded warehouses containing priceless collections of past White House furniture: desks, silverware, bureaus, beds, and other items used by past presidents as far back as George Washington. During the tour, the transitioning president is invited to select any heirlooms he likes and use them as furnishings inside the White House during his term. Only the bed in the Lincoln Bedroom is a permanent White House fixture. Ironically, Lincoln never slept in it. The desk at which Zach Herney was currently sitting inside the Oval Office had once belonged to his idol, Harry Truman. The desk, though small by modern standards, served as a daily reminder to Zach Herney that the â€Å"buck† did indeed stop here, and that Herney was ultimately responsible for any shortcomings of his administration. Herney accepted the responsibility as an honor and did his best to instill in his staff the motivations to do whatever it took to get the job done. â€Å"Mr. President?† his secretary called out, peering into the office. â€Å"Your call just went through.† Herney waved. â€Å"Thank you.† He reached for his phone. He would have preferred some privacy for this call, but he sure as hell was not going to get any of that right now. Two makeup specialists hovered like gnats, poking and primping at his face and hair. Directly in front of his desk, a television crew was setting up, and an endless swarm of advisers and PR people scurried around the office, excitedly discussing strategy. T minus one hour†¦ Herney pressed the illuminated button on his private phone. â€Å"Lawrence? You there?† â€Å"I'm here.† The NASA administrator's voice sounded consumed, distant. â€Å"Everything okay up there?† â€Å"Storm's still moving in, but my people tell me the satellite link will not be affected. We're good to go. One hour and counting.† â€Å"Excellent. Spirits high, I hope.† â€Å"Very high. My staff's excited. In fact, we just shared some beers.† Herney laughed. â€Å"Glad to hear it. Look, I wanted to call and thank you before we do this thing. Tonight's going to be one hell of a night.† The administrator paused, sounding uncharacteristically uncertain. â€Å"That it will, sir. We've been waiting a long time for this.† Herney hesitated. â€Å"You sound exhausted.† â€Å"I need some sunlight and a real bed.† â€Å"One more hour. Smile for the cameras, enjoy the moment, and then we'll get a plane up there to bring you back to D.C.† â€Å"Looking forward to it.† The man fell silent again. As a skilled negotiator, Herney was trained to listen, to hear what was being said between the lines. Something in the administrator's voice sounded off somehow. â€Å"You sure everything's okay up there?† â€Å"Absolutely. All systems go.† The administrator seemed eager to change the subject. â€Å"Did you see the final cut of Michael Tolland's documentary?† â€Å"Just watched it,† Herney said. â€Å"He did a fantastic job.† â€Å"Yes. You made a good call bringing him in.† â€Å"Still mad at me for involving civilians?† â€Å"Hell, yes.† The administrator growled good-naturedly, his voice with the usual strength to it. It made Herney feel better. Ekstrom's fine, Herney thought. Just a little tired. â€Å"Okay, I'll see you in an hour via satellite. We'll give 'em something to talk about.† â€Å"Right.† â€Å"Hey, Lawrence?† Herney's voice grew low and solemn now. â€Å"You've done a hell of a thing up there. I won't ever forget it.† Outside the habisphere, buffeted by wind, Delta-Three struggled to right and repack Norah Mangor's toppled equipment sled. Once all the equipment was back onboard, he battened down the vinyl top and draped Mangor's dead body across the top, tying her down. As he was preparing to drag the sled off course, his two partners came skimming up the glacier toward him. â€Å"Change of plans,† Delta-One called out above the wind. â€Å"The other three went over the edge.† Delta-Three was not surprised. He also knew what it meant. The Delta Force's plan to stage an accident by arranging four dead bodies on the ice shelf was no longer a viable option. Leaving a lone body would pose more questions than answers. â€Å"Sweep?† he asked. Delta-One nodded. â€Å"I'll recover the flares and you two get rid of the sled.† While Delta-One carefully retraced the scientists' path, collecting every last clue that anyone had been there at all, Delta-Three and his partner moved down the glacier with the laden equipment sled. After struggling over the berms, they finally reached the precipice at the end of the Milne Ice Shelf. They gave a push, and Norah Mangor and her sled slipped silently over the edge, plummeting into the Arctic Ocean. Clean sweep, Delta-Three thought. As they headed back to base, he was pleased to see the wind obliterating the tracks made by their skis. 61 The nuclear submarine Charlotte had been stationed in the Arctic Ocean for five days now. Its presence here was highly classified. A Los Angeles-class sub, the Charlotte was designed to â€Å"listen and not be heard.† Its forty-two tons of turbine engines were suspended on springs to dampen any vibration they might cause. Despite its requirement for stealth, the LA-class sub had one of the largest footprints of any reconnaissance sub in the water. Stretching more than 360 feet from nose to stern, the hull, if placed on an NFL football field, would crush both goalposts and then some. Seven times the length of the U.S. Navy's first Holland-class submarine, the Charlotte displaced 6,927 tons of water when fully submerged and could cruise at an astounding thirty-five knots. The vessel's normal cruising depth was just below the thermocline, a natural temperature gradient that distorted sonar reflections from above and made the sub invisible to surface radar. With a crew of 148 and max dive depth of over fifteen hundred feet, the vessel represented the state-of-the-art submersible and was the oceanic workhorse of the United States Navy. Its evaporative electrolysis oxygenation system, two nuclear reactors, and engineered provisions gave it the ability to circumnavigate the globe twenty-one times without surfacing. Human waste from the crew, as on most cruise ships, was compressed into sixty-pound blocks and ejected into the ocean-the huge bricks of feces jokingly referred to as â€Å"whale turds.†

Analysis On The Man To Send Rain Clouds

Reply from Rain Cloud Reader This is a very interesting story. Three parts of the story broke the story at three different times of the day. These characters are very cold, when he discovered that the old Theophilus died, he showed some emotions. This story aroused our interest, but that does not lead to a clear path and there is no real climax. This story needs to be read many times in order to be truly appreciated. Helen Johnson Analyzed paper sent by a man Yuyun essay author writer ethics paper ethics paper alarm banarasi explanatory article hometown first quarter analysis paper gossip comrades essay bmat 2016 thesis wife and her wife iyer analytic paper killing mimicry bird prejudice killing research paper writing Cheap gas comparative analysis paper my own biffle johnson savings essay on editorial articles excellent payment teacher research paper why people move papers cage animal thesis cats thesis the truth and lies bbc dangerous research papers on household chemicals , Resear ch papers on psychology on dreams, essays on environmental degradation leading to ceremonial research papers, and the consequences of boys in dealing with rationalism and empiricism, this article talks about an unprecedented frontline analysis thesis of the West A common core application essay article about my own articles article chinmon enfan jussi kukkola The thesis paper The alchemist Theme paper Population explosion paper Marathi pictures de laborem exercens paper Why the abolition of the pamphlet of the death penalty sentence 2 sonnet 2 Analysis thesis explanation article Important person quotation, Nicholas  · Goonie Illustration article Wafudato college entrance paper Children Labor papers 100 words University workload thesis patriotic thesis 2 military anniversary military leaders near anniversary Google research papers 500 words Macbeth Paper Image pdf Invoice Education Jay Papers Your Papers at a Future College 300 Workload Papers Philosophy Papers Just one person sends a paper on rain clouds George Shigler thesis sem break paper writer dbsv Research papers Diabetes Article medeniyaet Analyzing articles to light your corner in essay pop culture and social paper interview Explanatory paper discussing articles on cyber bully cpt code 58571 descriptive paper vuw New Zealand

Operation Management Week 6 Assignment Example | Topics and Well Written Essays - 250 words

Operation Management Week 6 - Assignment Example Traditionally, five major concepts are considered in project management. These concepts form the project management processes prescribed by the Project Management Body of Knowledge (PMBOK). The five concepts are initiation, planning or design, production or execution, monitoring and controlling, and closing (David and Cleland, 2006). From the diagram below, it would be noted that some of the concepts are independent, whiles other depend on others. There are also some that interrelate to each other. On the whole, the concepts are in place to ensure that at every point in time, there will be a systematic way of approaching projects to achieve the goals of process improvement. Examples of projects that have been conducted following the concepts of project management and the success that came out of these projects continues to be an inspiration for others to follow the concepts. A typical example of such project can be cited as the Walt Disney Companys Theme Parks, which was carried out using the ITIL initiative of project management. Carried out in 2010, the project has become one of the finest examples of projects that met project management core concepts (The APM Group and The Stationery Office,

Strategic Financial Management - Coursework one

Strategic Financial Management - one - Coursework Example The shareholder and the stakeholder are two important people in the organization. The shareholder is the owner and financier of the organization. It is therefore a noble objective, that any policy initiated by the organization, should aim at benefiting the shareholder. This is always depicted through a rise in their share prices, and periodic payment of dividends. This is the concept which is referred to as maximization of the wealth of the shareholder (Roe and Law, 2001). Another important constituency that contributes to the value of a company is the stakeholder. This is an individual who has the capability of affecting or being affected by the policies of an organization. These people include customers, the community where the company is operating, the government, suppliers, creditors, etc. This paper provides a discussion on whether maximization of shareholders wealth is a realistic objective by the company. After the financial crisis of the late 2000, and the emergence of the Enron scandal, there has been a critique of shareholder wealth maximization by experts of business and management. In as much as focusing on the value of the shareholder has the capability of benefiting the owners of a corporation, it is unable to provide a clear guidance that can be used for purposes of measuring social issues such as environmental, employment and ethical business practices (Kolb, 2008). For instance, the management can be involved in the maximization of the value of a shareholder, consequently lowering the welfare programs of third parties. For instance, in a bid to maximize the wealth of shareholders, the company may be forced to pay low salaries to its employees. A company such as Wal-Mart is constantly accused of underpaying its employees, for purposes of generating more profits to its owners. In fact, as of the year 2014, Wal-Mart is the company that had

The fundamental Premise is that business performance will be better Essay

The fundamental Premise is that business performance will be better when there is an alignment between competitive stragegy and the managment of core operating workers inside the business - Essay Example cceptable quality levels and prices; enter into agreements with unions in order to stabilize labour market conditions and be informed about the activities of competitors" (Putti, 1987). Aiming to enable the organization to achieve its strategic goals by attracting, retaining and developing employees, Human Resource Management functions as the link between the organization and the employees. A company should first become aware of the needs of its employees, and at a later stage, understand and evaluate these needs in order to make its employees perceive their job as a part of their personal life, and not as a routine obligation. The Human Resources (HR) function provides significant support and advice to line management. The attraction, preservation and development of high calibre people are a source of competitive advantage for our business, and are the responsibility of Human Resource Management Department. Human resource management is very crucial for the whole function of an organization because it assists the organization to create loyal employees, who are ready to offer their best. The concept of Human Resource Management developed with a more strategic level of thinking about the nature and role of people (as total 24hr per day human beings) working in organizations which are ‘cultures’ in their own right (Lundy O, 1994). While the recent thinking has moved from the control-based model to the compliance model, the soft edge of the latter involves eliciting employee commitment and expecting effectiveness and efficiency to follow. The hard edge of the latter involves ridding the organization of unnecessary layers of middle management which, when stripped of control functions, have very little by way of value added. "The HRM planning should be based on the organisations strategic planning processes with relation to analysis of the labour market, forecasting of the external supply and internal demand for labour, job analysis and plan implementation" (BPP,

Marketing Research Essay Example | Topics and Well Written Essays - 2250 words

Marketing Research - Essay Example The Market Research Society of UK gives the definition as: 'the collection and analysis of data from a sample of individuals or organizations relating to their characteristics, behavior, attitudes, opinions or possessions. It includes all forms of marketing and social research such as consumer and industrial surveys, psychological investigations, observational and panel studies (MRS, 1994) 1. Exploratory Design: This is used to discover the general nature of a problem and variables associated with it. It helps in formulating of relevant hypotheses. This uses primary techniques like focus groups, in-depth interviews and observational studies and also uses secondary data, non-probability samples, case analysis and subjective analysis of the resultant data. They are generally qualitative in nature. 2. Descriptive Design: They focus on the accurate description of the variables under consideration. They use questionnaires and surveys. They are used for determining consumer profile and their product usage studies, price and attitude surveys, sales analysis, media research etc. They are quantitative in nature. 3. Causal Designs: They try to establish the nature of relationship between two or more variables under investigation. The direction of the Causal link is very important. The example of their uses may be measuring the effectiveness of advertisement in terms of sales or study of price elasticity of demand etc. Marketing Research Process: The Marketing Research Process can be divided in the following stages: 1. Define the Problem: The first and most crucial stage of the process is defining the problem and providing the necessary information to the Research team which will help them prepare a proper design plan. This stage helps the organization to assess its current position, to define its information needs and to prepare it to make informed decisions about its future. The information provided helps the market researchers with in-depth understanding of the situation. It is important for the market researcher to interview the staff commissioning the study and any other persons who can shed some light on the situation. This helps in forming the Market Research questions, which will lead to forming sub questions. The success of the research depends solely on understanding the problem and defining the questions and sub-questions for which answers are sought by the research. For our case of Hobbit's Choice the basic problem identified is the feasibility of a fine, upscale restaurant featuring the finest entrees, drinks, and desserts in an elegant atmosphere. 2. Decide Research Plan: At this stage the researchers decide in which category his research should fall into. In our case the Hobbit's choice, we have to first find out whether the research will fall into Qualitative or Quantitiative category. In Quantitative category the research is designed to elicit

Earth Sciences Essay Example | Topics and Well Written Essays - 1000 words

Earth Sciences - Essay Example Thus, careful study of the accurate cardinal orientation of the Great Pyramid at Giza, Egypt, and the Venus alignment of the Maya Palace of the Governor at Uxmal in Yucatan can reveal to what extent associated ancient cultures were advanced in their knowledge of astronomy and possibly provide scope for amazement at such achievements of monumental precision ((The Center for Archaeoastronomy, 2002). Stonehenge (Figures 4 & 5) has special significance to archaeoastronomy. It is certainly not the largest ancient stone circle in the world but it is certainly the only one with lintels on the upright stones (English Heritage Website, FAQs on Stonehenge). "Stonehenge, the word, is believed to have originated from the Anglo-Saxon period, from the old English word "henge' meaning 'hanging' or 'gibbet'. Thus, Stonehenge literally means the 'hanging stones' and may have been derived from the lintels that seem to hang above the uprights (English Heritage, Historical Background, Stonehenge, 2006). Today 'henge' has a special significance in archaeology meaning a circular construction of either stone or timber (English Heritage, Historical Background, Stonehenge, 2006). The discoveries at Stonehenge in the 60s have made the interdisciplinary fields of archaeoastronomy and ethnoastronomy (the study of contemporary native astronomies) active fields wherefrom scholars derive knowledge of our species' continuous interaction with the cosmos (The Center for Archaeoastronomy, 2002). The report seeks to find clearly why Stonehenge was built, when it was built and by whom. It shall explore available literature with research findings in recent years to attempt to do so. 2 Stonehenge - The English Heritage Monument: 2.1 Introduction: English Heritage and the National Trust look after Stonehenge jointly. Though curious visitors have been coming to the ancient site to gawk at the monumental constructions for over 5000 years it has only recently in 1986 been declared a World Heritage Site (English Heritage, Historical Background, 2006). Researchers from the English Heritage Scientific Dating Service used a variety of dating techniques to assess dates when the monument was built. The researchers assert that Stonehenge was built in three phases - the oldest construction was the Mesolithic activity in the present car park attached to the site. It must be noted here that the team

Religious Identity Essay Example | Topics and Well Written Essays - 2250 words

Religious Identity - Essay Example Religious identity thus refers to â€Å"a people’s ways of relating to their religion, including their association with a certain religious community, the strength of their belief in the preferred religion, and their ways of demonstrating those beliefs in their day to day lives.† It can be equated to membership to a religious grouping or community, this being regardless of the person’s religious activity or participation. It may be referred to as a specific type of Identity formation focusing mainly on group membership and the importance of the membership as pertaining to self-conception of the individual. Similar to either cultural or ethnic identities, the religious context provides generally a perception from which to view the world, a set of principles of guiding one’s lifestyle and the myriad of opportunities available of socialization with different people, generational differences regarded. As a whole, religious identity is affected by factors such as a person’s gender, generational status and ethnicity.... Religion is intricately intertwined with various aspects in the socio-cultural arena, that the above three factors are always present in the shaping of an individual’s religious identity. Ethnic differences; according to the Social Identity Theory, emerge when individuals of ethnic minority groups feel threatened in terms of identity, thus reasons for their emphasis on their social identities as a means of maintaining positive self-conception. Gender differences may impact on one’s religious identity; this being exemplified through the characteristic participation of the female gender in religious activities and in their expression of religion as being an important aspect of their lives, this being in relation to their male counterparts (Bryan Chosley Shepherd; The University of Texas at Austin. Sociology 32). Generational differences, categorized as either being first, second and third, where the first and second-generation individuals may have higher levels of religio us identity as compared to their third generation counterparts. Immigrants, in efforts of readjustments to the often-stressful changes associated with immigration, highly seek an environment provided by a place of worship that encompasses a community of emotional, financial and social support. Focus is placed on the stages of Adolescence and early Adulthood since adolescence is a developmental period that is crucial to an individual’s identity development. At this stage, there are various opportunities for the exploration of the ethnic, cultural and religious traditions present in the individual’s society, but within constraints erected by their parents or guardians. Influences can be both internal and external; depending on extent/exposure of socialization

Economy of the United States Before During and After World War Ii Essay Example for Free

Economy of the United States Before During and After World War Ii Essay They were also encouraged to ration their food and gas, and often grew Liberty Gardens. Unfortunately, World War II also made the American Government used to relying on deficit spending (government spending of borrowed money), causing economic problems that still linger today. Thats all I have. Hope it helps! Everything listed above is definatly true to a point, Im a history major who has to answer this question for an exam later this week so I thought Id help add some more information for the people who are looking WWII was an expensive war, it would cost $304 billion just to finance it. For this reason the governmnet pushed war bonds which encouraged common people to help support the war both with their money and with their hearts. From the get go the war was marketed to the common people, proven by the use of popular movie stars in the promotion of War fund-raising and compliance with governmnet measures. After pearl harbor, the American people were ready to pour everything they had into the war effort. Women donated thousands of tons of aluminum cooking supplies to help build planes though it was later found that only virgin aluminum was good enough for aircraft and so their pots and pans were melted down and sold back to them as pots and pans. In the first months of the war Washington was a mess, and mobilization was slow. This is because our governmnet is not made to act swiftly, it was designed to take time and thought before any decision can be made. Scrap drives were unorganized and so were the efforts of the common people. Those who could not physically join the armed forces wanted to know what they could do to help but the governmnet expected little more from them than the purchasing of war bonds and for them to practice conservation of goods. Other items which were recycled included bone and fats which were used in making explosives and other materials. One of the greatest failures of American govenmnet was the policies which did not encourage the full use of all of the American people. While Rosie the Riveter posers might make it seem that women were begged to help in factories, the truth is that Americans tried to keep the women home for as long as possible before labor shortages around 1943 made it nessisary for factories to stop policies of discrimination. Comming out of the Depression, America had 9 million men that needed jobs. Each and every one was employed before women and minorities were given a chance to go to work. Even more difficult than the position of minorities was that of married women, especially those with the men of their families fighting overseas. America had been progressing socially as a nation under FDR, but his social reforms had taken a back seat to the war effort. Day care was almost non-existant, and where it was it was impossible to afford. Many stores also chose to keep the same hours they had during peace time and so women who worked late had a hard time getting the items they needed. Married women who had husbands in the workforce were also discriminated against because a common attitude was that the man should be the sole bread-winner of a household and children would be denied proper care if their mothers worked. Many goods that people took for granted disapeared, and with more money than they had seen in years the American public had little to spend it on. Gasoline was rationed and in many cities Sunday driving was banned, those who violated the laws had their gas coupon books taken away. The decrease in driving worked both to save gasoline and to put many new business, which depended on drive-in coustomers, to fail. Most people were given a card that allowed them 2 gallons of gas per week, with unrestricted gas reserved for emercency vehicles, police officers, and a few unscrupulous congressmen. Meat was also rationed at 2lbs per person per week which was very difficult for some people to live with. Conservation and the war effort also found its way into popular fasion. Durring the war shoes could only be found in limmited colors (i. e. 4 shades of brown, and black) and clothes were not allowed to be made with any more material than was absolutly nessisary, pleats, ruffles and other embelishments were thrown out for the durration. (This is one of the reasons why short skirts and bare-backed dresses were all the rage). A black market of rationed goods and consumer goods (such as sheets) was strongly revived during this period, but was not so pervasive as to undermine the system. With money burning holes in their pockets, Americans turned to the entertainmnet industry, which with its glamourous actors and fantastical stories, helped to distract the public from their problems. Also, the governmnet had its own idea about what Americans should do with their extra money, during the war the income tax was introduced to suppliment GI spending and has been with us ever since. One thing I would like to correct from what is stated above is the idea that minorities gained rights as a result of the economic boom and the war effort. What happened is that minorites began to actively fight for their rights after WWII. Women did not want to be thrown out of their positions after the men came home from the war, they liked the freedom of having their own income and enjoyed doing something other than cooking and cleaning. African-Americans also were feircly discriminated dirring this time. It would not be until after the death of FDR that the new president Harry Truman would finally desegrigate the military. This nations minorities were fighting overseas for freedom and equality when in fact they were not given these freedoms at home. After the war, blacks who had served in the military moved out of the south and sought a better life in the north where they could escape the racial caste system which existed there. Jews were also discriminated here as well as in many other countries. We were eager to condemn Hitler for murder and open persecution, but we did not want to take the Jews off of his hands alive. If you need more info, consult this book: ONeil, W. L. (2002). A Democracy at War: Americas Fight At Home and Abroad In World War II. Cambridge: Harvard University Press. Most of my ideas come from that text, nothing is quoted directly. Hopefully this helps too!

An Analysis Of The National Interest Of India Politics Essay

An Analysis Of The National Interest Of India Politics Essay National Interest is one of the important concepts for a country in International Relations. As a whole, it is defined as survival and security of a state. It mainly focuses on the countrys ambitions in cultural, military and economic backgrounds (Lavy, 1996). Although national interest of a country has different dimensions, we consider security and prosperity as considered as the primary goals. The other dimensions include economic development, advancement in military operations and retention of countrys culture in this modern world. The National Interest differs from country-to-country depending on their primary goals. National Interest is a process which prioritises the main problem in which the country should develop in. India is a country with a billion people population and has different dimensions of thoughts. The need for a particular state is of lowest concern for others. So it is hard and a complex job to prioritise the national interest for the people of India. In this ess ay, let us examine the history of National Interests and also the interests of India. HISTORIC EMERGENCE OF NATIONAL INTEREST: In the early 19th century, national interest was considered as important to that of a religion. This concept of National Interest was introduced by Niccolo Machiavelli but was first seen in practice during the Thirty years war by the French Chief Minister to reduce the increasing power of the Holy Roman Emperor. After these incidents, National Interest became a dominant term in European politics. During the Congress of Vienna, the government practiced the new concept of balance of powers which resulted in balancing the national interest in many countries. The consequences of the balance of powers were devastating and resulted in the First World War, so this concept was replaced by Collective Security. The concept of Collective Security was not successful because United States did not join the League of Nations and the concept was not in the borders of National Interest (Byrd, 1996). Realist and Neo-Realist concepts emerged during the Second World War due to the dominance of power in the world. League of Nations and its idealistic approach was considered as the reason for the formation of fascist states of Germany and Italy who were the causes of Second World War. Nowadays, the concept of National Interest is often related to policies which differentiate the idealistic policies. By differentiating the National Interest with idealistic policies, it paves ways for good foreign policy by relying on multilateral institutions. The term National Interest is used by many countries to prioritise the problems they had been facing in the past and also setting goals for future forecasts. These policies are more or like the ways or processes which have a positive notion for the particular country. Antonio states that National Interest and Law and Order are different from each other and have no importance when combined together (Byrd, 1996). NATIONAL INTERESTS OF INDIA: As the standard definition states that, survival of the state is important for the citizens to pursue happiness and prosperity. India adheres to the standard definition of National Interest. According the above definition, Indias national interest should be framed taking into account its territorial integrity, economic competition from other countries and ways to reduce those threats. The foreign policy of a country also depends on the national interests for its improvement (Venkat, 2007) Considering the Indias primary national interest as states survival, security and maintaining strong relationship with other countries, Indias national interests are Energy security, deals with the prolonged desire of nuclear fuel and nuclear technology. Securing unity and territorial integrity with China and Pakistan. During this process, India should maintain stability in government and peace for its fellow citizens. The conflict between India-Pakistan will be resolved only when the social-political changes occurs in Pakistan. Improving influence among the Asian countries by providing security and military intelligence to the smaller countries. Achieving greater freedom in the Indian subcontinent in trade and investment. These national interests are set to change from time-to-time according to its fulfilment. POST-INDEPENDENCE SECURITY: Territorial Integrity and Unity are considered as one of the important objectives to be fulfilled by India. The main aim in those perspectives is to settle the disputes of Indias long borders on LOC (Line of Control) of Pakistan-occupied Kashmir with Pakistan and LAC (Line of Actual Control) with China. These borders of LOC and LAC are controlled by Pakistan and China respectively. The providence of Pakistan-occupied Kashmir was invaded by Pakistan in 1947 and on the other hand, the China invaded the borders of Arunachal and Himachal Pradesh during 1956 and 1962. It is one of the important duties of a country to protect its current borders. So India should try for a best possible way to resolve the complex disputes with those two countries. India should consider implementing some strategies and tactics to overcome the problems in these regions because these are the primary concerns for India. Having fought many wars in LOC, Pakistans army and ISI have been aiding in removing the anti -social elements from the Pakistan-occupied Kashmir providence (Parisar, 2010). As India is considered as one of the fastest developing countries in the world, it should be well equipped in terms of defence and military operations. In order to keep up the momentum going, India should come up with some policies which are helpful in reducing the poverty. In order to achieve these goals, India should maintain a good relationship with its regional countries and also with other countries like the countries in Middle East, Central Asia, Indian Ocean regions and South East Asia. This makes meaning as to why Indias stance on Non-Alignment serves as the core National Interest of the country (Parisar, 2010). The importance of Indias relationship with USA is important and cannot be undermined. Even though, USA had been hit by the worst financial crisis ever in the recent decades, it is still the most dominant super power in the world. India has always maintained a good relationship with US in the fields of trade, science and technology, security issues, energy security including nuclear and non-conventional energy sources. Secretary Hillary Clinton has also emphasized that the democratic political system of both the countries also serve as a binding factor for the close relationship. Political systems, values and other beliefs are considered as the important factors to maintain a close relationship with USA (Dutt, 2007). SOCIAL AND ECONOMIC PROGRESS: The first priority was given to the advancement of the social and economic sector after the independence in 1947 but due to the shortages in defence sector, the progress in those fields were reduced. There has been a continuous increment of economic growth over the past three decades and reduction in people below the poverty line. This change was only possible just because of the closing the gap of inequality in India. Essentially the main aim of the Indian government is to satisfy the progress in defence and development of the state as whole. Owing to a bigger surface area, free India did have a complex security situation which it failed to address it at full concern and allocating only 1.5 to 2.8 per cent of the GDP. As India is considered as one of the fastest developing countries in the world, it should look in reducing the poverty stuck people by improving the socio-economic conditions and creating more jobs for the people in the country. India is posed with the biggest challeng es in the development of social and economic sectors because it should consider the development of the middle class by eliminating the regional inequalities and social imbalances and also have a close look at the overseas Indian population. As we step into the 21st century, there are some factors from the other countries which influence the political, military and economic behaviour of India. They are: United States is ranked as the super power in the world. Its policies of creating alliance in political, military and economic sectors with other major countries have increased their influence in the international arena. This has helped the power of many countries to be rising when compared to India; India has also been influenced by China as it is growing rapidly and it is represented as the second most powerful country in the world. China will continue to follow its current political policy and represent the most powerful authoritarian state in the world; Japan should also be consid ered in this context as it is a techno-economic super power. Its policy of undermining its military power should be taken into account; Another major power which should be considered is Russia. Even though, it has been struggling because of the political-social crisis and the collapse of the Soviet Union, it has advanced in the production of nuclear weapons and encouraged its military capabilities. These features make Russia to be addressed as an important country which can make changes to this modern world; European Union is emerging as a major power as it is coordinating its policies with the alliance countries. This process will turn out to be a successful venture for India in the coming years. As we can see from the above factors that the world is turning towards the Asian land mass for its development. India has also inked in a historic deal with United States for the exchange of nuclear fuel and nuclear technology for the period of 10years in 2005. This historic deal will help reduce and fuel the growth of the industrialised India by 2020. This proves that the development in the coming years will be Asia centric (Nitin, 2007). CHANGING SECURITY CONCERNS: With advancements in the information technology and science, the world is ready for another military revolution. This revolution in the coming years could entirely change the nature of war as we know it in the present. India can be an important country which could play a role in ensuring regional and global peace around the world. The results of the cold war have not helped in reducing the mass destructive weapons and did not promote peace in many countries. In turn it made exclusive laws to retain these weapons for the protection of the super power countries to remain dominant over others. This has made the penetration of these mass destructive weapons to the small countries legally and illegally. The security concerns at this instance are deteriorating all throughout the world. So India should be more focussed on monitoring and analysing the security measures that it has taken to ensure a secure environment. These steps are considered very important for India because terrorism has involved into a biggest problem these days and are penetrating in many parts of the world. India has also partnered many countries in fighting terrorism to ensure a secure India to all the people. They have been spending 2% of their GDP for their military operations and developments. All these factors are considered as important challenges that India need to take it into account when constructing its military operations in the future. India should work with the ASEAN countries to address the security measures which are useful for the Asian regions as whole. It should also work with Non Aligned Movement countries to defend and provide solution for the international community and also keep good relati on with the major powers and main partners. India should provide a secure transfer of equipment and material that are important for Indias defence program (Venkat, 2007). Another major concern for India is that of its geographic location. India is placed just in the middle of countries which are well known for its arms traffickings and narcotics. India is placed between North West Pakistan and Afghanistan and Myanmar on the other side. The military training camps which fight the holy war against the world in the regions of Afghanistan and Pakistan should also be considered as the major threat for the security of India (Raman, 2011). The national security of India just cannot be taken for granted as it involved during the cold wars stages. The main reason for this is that of the advancement and sophistication of the weapons developed by many countries and the ways in which the wars are fought nowadays. The security that prevailed during the cold war stages only focussed on nuclear weapons and missiles but today the problems have become more complex and intense. There are many countries which have also opted out of procuring these dangerous weapons. Today countries have to build security measures which combat to the needs of political, economic and military needs in common. DEMOCRATIC MODEL FOR DEVELOPMENT: India is one of the biggest democratic countries in the world. Democracy proves to be an important tool to ensure that the benefits of the government are equally shared across the entire population without violence and exclusions. Democracy is also a process which guarantees rapid growth of power and wealth. In India, democracy has opened up to many peoples to stand for their rights. It is also stated that the other neighbouring countries after seeing the democratic model of India have ensured support and peace to all their citizens. For India, democracy should remain as a top priority in the future years to offer peaceful and proper guided country. Firstly, we need to recognise that the democratic model is never fast or easy as it is the complex combination of culture and policies. We also say that culture is not the destiny to get democracy. The countries with different culture, race, religion and different levels of development have promoted democracy and had been successful in it . In democracy, there is nothing which involves the cultural factors like Asian values, militarism or tribalism. India should promote and support democratisation by improving fair trade and investment from their citizens. The process of encouraging trade and bilateral investments also helps to improve democratic development. Political institutions should be given the power to enforce property rights to protect human rights and law. The main problem that comes into action is the corruption that takes place by the ruling party and others in power. These corruptions get unnoticed because of the fight in the corporate companies for corruption. The main strength of the present India is that of its well educated middle class population, it represents about 70 per cent of the total population. This advantage also creates new horizons for political movements and parties to establish a good government in the future. Trade also serves as one of the important issues for the development of the country, it not only helps us for the domestic economy but also for the foreign policy as a whole. Foreign cooperation with other countries, security developments and trade together helps India to be independent in the world. Promotion of democratic development is possible only when all of the above policies progress in the future (Bakshi, 2009). CONCLUSION: Even though India has been trying hard to maintain secure environment, it has failed to do so because of the threats from the anti-social elements. India has also increased their defence budget and has also acquired some war-heads and combat aircrafts from other countries. Indian government is also trying to make the better use of peoples money by updating their weapons and bringing confidence to the public as that of the Mumbai attacks. India as it goes by the roots, it takes democracy to attain peaceful and a secure country. As India is growing rapidly, it has to have a safe, secure and a stable neighbourhood. So India is ready to join and perform any security measures at the international level or regionally to bring stability and peace to the world. India should also provide security to citizens by reducing the riots in the country. It should also provide a secure environment and support for the people of India who live overseas. India owing to its multicultural society and a uni que democracy has ability to be considered as an example to many other countries to live peacefully. India in the recent years has opened its economy to foreign investors and is also providing rebates for their establishment. This has in-turn helped to boost the Indian economy from the FDIs and reaped good dividends from the markets. All these rapid developments and investments are only possible if India enhances its security and defence in the coming years.