Do Switching Costs Moderate the Price Effect of Search Cost Reduction? Internet Use and Fares in the U.S. Airline Industry

( Hwa Ryung Lee ) 정보통신정책학회 2014 정보통신정책학회 학술발표논문집 Vol.2014 No.1

A reduction in search costs is generally believed to make markets more competitive, However, The effect may be smaller if consumers must pay costs for switching products. This paper invest-tigates how search costs affect prices in the presence of switching costs using U.S. domestic airfare Data for2000-2010. We develop a simple and dynamic theoretical framework which highlights the interaction between search and switching costs in determining prices. In the empirical analysis, we use the average network size of airlines in a market as a proxy for switching costs related to a Frequent Flyer Program (FFP) and Internet usage as a proxy for (the inverse of) search costs. The Results show that increasing Internet usage lowers airfares but the effects is smaller for markets with a Larger average network size. Maintaining consistency with the theoretical framework, these results Suggest that switching costs allow firms to avoid moving to a more competitive pricing regime when Search costs decrease.

위치기반 서비스를 통한 정보 필터링이 사용자의 불확실성과 정보탐색 행동에 미치는 영향

적효림,임일 한국경영정보학회 2014 Asia Pacific Journal of Information Systems Vol.24 No.4

With the development of related technologies, Location-Based Services (LBS) are growing fast and being used in many ways. Past LBS studies have focused on adoption of LBS because of the fact that LBS users have privacy concerns regarding revealing their location information. Meanwhile, the number of LBS users and revenues from LBS are growing rapidly because users can get some benefits by revealing their location information. Little research has been done on how LBS affects consumers’ information search behavior in product purchase. The purpose of this paper is examining the effect of LBS information filtering on buyers’ uncertainty and their information search behavior. When consumers purchase a product, they try to reduce uncertainty by searching information. Generally, there are two types of uncertainties – knowledge uncertainty and choice uncertainty. Knowledge uncertainty refers to the lack of information on what kinds of alternatives are available in the market and/or their important attributes. Therefore, consumers having knowledge uncertainty will have difficulties in identifying what alternatives exist in the market to fulfil their needs. Choice uncertainty refers to the lack of information about consumers’ own preferences and which alternative will fit in their needs. Therefore, consumers with choice uncertainty have difficulties selecting best product among available alternatives.. According to economics of information theory, consumers narrow the scope of information search when knowledge uncertainty is high. It is because consumers’ information search cost is high when their knowledge uncertainty is high. If people do not know available alternatives and their attributes, it takes time and cognitive efforts for them to acquire information about available alternatives. Therefore, they will reduce search breadth. For people with high knowledge uncertainty, the information about products and their attributes is new and of high value for them. Therefore, they will conduct searches more in-depth because they have incentive to acquire more information. When people have high choice uncertainty, people tend to search information about more alternatives. It is because increased search breadth will improve their chances to find better alternative for them. On the other hand, since human’s cognitive capacity is limited, the increased search breadth (more alternatives) will reduce the depth of information search for each alternative. Consumers with high choice uncertainty will spend less time and effort for each alternative because considering more alternatives will increase their utility. LBS provides users with the capability to screen alternatives based on the distance from them, which reduces information search costs. Therefore, it is expected that LBS will help users consider more alternatives even when they have high knowledge uncertainty. LBS provides distance information, which helps users choose alternatives appropriate for them. Therefore, users will perceive lower choice uncertainty when they use LBS. In order to test the hypotheses, we selected 80 students and assigned them to one of the two experiment groups. One group was asked to use LBS to search surrounding restaurants and the other group was asked to not use LBS to search nearby restaurants. The experimental tasks and measures items were validated in a pilot experiment. The final measurement items are shown in Appendix A. Each subject was asked to read one of the two scenarios – with or without LBS – and use a smartphone application to pick a restaurant. All behaviors on smartphone were recorded using a recording application. Search breadth was measured by the number of restaurants clicked by each subject. Search depths was measured by two metrics – the average number of sub-level pages each subject visited and the average time spent on each restaurant. The hypotheses were tested using SPSS and PLS. The results show that knowledge...

관광지 전문성이 관광정보 탐색비용에 미치는 영향 고찰

오세현(Oh Se hyun),이환의(Lee Hwan eui),유예경(Yoo Ye kyoung),류지호(Ryu Ji ho) 대한관광경영학회 2017 觀光硏究 Vol.32 No.5

본 연구의 목적은 관광자가 지닌 관광지에 관한 전문성이 관광정보탐색비용을 감소시킨다는 Gursoy & McCleary(2004)의 구조 모델 중 (1) 전문성과 외부정보탐색비용과 내부정보 탐색비용에 관한 모델을 적용하여 실증연구를 통한 관계를 고찰하는 것이며, (2) 모바일을 활용한 관광정보탐색은 정보탐색비용에 어떠한 영향을 미치는지 그 조절효과를 검정하는 데 있다. 이론적 모형 및 구성개념은 기존 연구를 통하여 도출되었으며, 제안모형의 가설을 검정하기 위하여 서울 시내 대학생을 대상으로 실증조사가 이루어졌다. 설문조사를 통해 수집된 총 283명의 자료는 SPSS를 활용한 회귀분석으로 분석되었으며, 그 결과는 다음과 같다. 첫째, 관광지 전문성은 외부정보탐색비용을 증가시켰으며 그 중 관광지에 대한 사전지식이 외부정보탐색비용에 유의한 효과를 나타냈다, 둘째, 관광지 전문성은 내부정보탐색비용에 정(+)의 방향으로 유의하게 작용하였으며, 관광지에 대한 사전지식 및 관광지 결정에 대한 본인의 의사결정이 내부정보탐색비용을 증가시켰다. 셋째, 관광지 정보탐색의 모바일 활용은 외부정보탐색비용과 내부정보탐색비용을 감소시키는 효과를 나타냈으나, 관광지 전문성과의 상호작용효과는 검정되지 않았다. 이와 같은 결과를 토대로 대안모형을 설정하였으며, 실증분석 결과에 대한 학문적 시사점과 실무적 시사점을 제시하였다. This study (1) examined the effect of destination expertise on cost of external information search and cost of internal information search and (2) verified the moderating role of mobile usage for destination information search. The conceptual model was designed based on previous literature review and the model was tested empirically. Data collected from 283 undergraduate students were analyzed using hrerarchical regression analysis. The analyses results revealed that the destination expertise had a positive effect on the costs of both external and internal information search. In addition, the moderating role of mobile usage for destination information search was insignificant between destination expertise and costs of external/internal information search. Therefore, alternative model was identified and academic and practical implications were provided.

인터넷 소비자 관점에서 본 웹 검색 비용과 이익 요인

이은주(Eun Ju Lee),한동일(Dong Il Han) 한국경영학회 2007 Korea Business Review Vol.11 No.1

인터넷이 대중적으로 보편화됨에 따라 웹 검색 관련 제반 기술이 급속도로 발전하고 있다. 현재와 같이 인터넷 상에 존재하는 정보의 양이 기하급수적으로 증가하고 있고 또한 웹 상의 수많은 정보가 체계 없이 산재하는 상황에서 기존 단순 웹 검색 방식의 발전은 기술적인 한계에 부딪치게 된다. 차세대 웹 관련 기술인 시맨틱 웹(Semantic Web)은 기존의 인터넷 상에 존재하는 엄청난 양의 정보를 보다 지능적이고 이용자에게 적합하도록 관리/처리할 수 있게 하는 선진 기술로서, 웹 검색 이용자들은 시맨틱 웹을 사용하면 좀더 정확하고 수준 높은 검색 결과를 기대할 수 있다. 그럼에도 불구하고 대부분의 인터넷 소비자들은 기존의 단순 검색 식에 익숙해져 있어 보다 향상된 기술을 사용하는 시맨틱 웹 검색 방식으로 전환하는 과정에서 일련의 소비자 저항이 예상된다. 본 논문에서는 웹 검색 소비자 관점에서 검색 비용 요인과 검색 이익 요인을 이론적으로 도출하고, 이들 요인이 웹 검색 행위와 소비자 만 족에 미치는 영향을 실증적으로 검증하였다. 본 논문에서 도출한 웹 검색 비용과 이익 요인은 향후 전개될 시맨틱 웹 검색 방식의 인터페이스 개발에 있어서 중요한 시사점을 제공한다. The Internet and related technologies are being developed rapidly. While most online data are developed in HTML format, semantic Web, the 3rd generation Internet, is a new efficient way of representing data on the World Wide Web. Semantic web allows information to be understood by computers by giving meanings (semantic) and semantic web-based search as opposed to existing HTML-based search engines can provide more accurate and customized search results by understanding user profiles and surroundings. In order for online consumers to fully realize the potential benefits of semantic-web based search, they should provide more keywords and richer information, which raises search costs on the customer side. Most online consumers of Internet search are accustomed to old search interface that requires only one or two key words, thus a certain leval of customer resistance can be expected in the diffusion of semantic web-based search. Drawing on existing literature, we identified factors perceived as costs and benfits of online search. Using 106 usable survey results, we confirmed cost and benefit factors and examined how they affect consumer search behavior and sastiscation. Managerial implications for customer-centered interface development of semantic-web based search technologies are offered.

An Empirical Study of the Effect of the Internet on Fares in the U.S. Airline Industry

LEE, HWA RYUNG Korea Development Institute 2015 KDI Journal of Economic Policy (KDI JEP) Vol.37 No.1

A reduction in search costs is generally believed to make markets more competitive. However, the effect may be mitigated or amplified if consumers must pay costs for switching products. This paper investigates how search costs affect prices in the presence of switching costs using U.S. domestic airfare data for 2000-2010. The airline industry experienced a dramatic decrease in search costs with increasing Internet use in the 2000s. At the same time, the industry is known for its frequent flyer programs (FFPs), which increase switching costs for consumers. We use the average network size of airlines in a market as a proxy for switching costs related to FFPs and Internet usage as a proxy for (the inverse of) search costs. The results show that increasing Internet usage lowers airfares but that the effect is smaller for markets with a larger average network size.

An Empirical Study of the Effect of the Internet on Fares in the U.S. Airline Industry

이화령 한국개발연구원 2015 KDI Journal of Economic Policy (KDI JEP) Vol.37 No.1

A reduction in search costs is generally believed to make markets more competitive. However, the effect may be mitigated or amplified if consumers must pay costs for switching products. This paper investigates how search costs affect prices in the presence of switching costs using U.S. domestic airfare data for 2000–2010. The airline industry experienced a dramatic decrease in search costs with increasing Internet use in the 2000s. At the same time, the industry is known for its frequent flyer programs (FFPs), which increase switching costs for consumers. We use the average network size of airlines in a market as a proxy for switching costs related to FFPs and Internet usage as a proxy for (the inverse of) search costs. The results show that increasing Internet usage lowers airfares but that the effect is smaller for markets with a larger average network size.

일차의료단계에서의 정보탐색비용 추계

배은영,양봉민 서울大學校保健大學院 1995 國民保健硏究所硏究論叢 Vol.5 No.1

This study intended to estimate information costs at primary care level and to investigate the factors that would impact on the costs. The object of this study was the outpatients of the 8 clinics selected by random sampling in Kwan-ak Gu, Jong-no Gu, and Kang-nam Gu. This study employed the research method to interview with 164 outpatients of these clinics mentioned above. This study was undergone with hypothesis that the information searching activity in medical sector would include the purchasing activity. Therefore, the cost of medical shopping-around was regarded as also information costs. But, Owing to the technical reason, this study did not include the time cost, the provisional cost that would be spent for the delayed pain(the case of not being cured in exact time), and the cost calculated by valuing the pain itself. Thus, including shopping-around cost, the estimate of information cost was 45,787 won. According to the results, the information cost will rise as the disease-experience is less, symptoms of the disease is more serious, client-agent relationship is weaker, and usual health status is worse.

공공임무용 드론의 사회적 비용·편익 분석에 대한 연구: 실종자 수색용 드론을 중심으로

강욱 한국테러학회 2018 한국테러학회보 Vol.11 No.4

This study performed the social cost - benefit analysis of public drones which is one of the key technologies of the 4th Industrial Revolution. The discussion focused on the police's search for missing persons, which were being utilized on the site, among the drones used in the public sector. The government plans to use drones in various public sectors such as disaster, police, and public construction and is implementing intensive support. This research is meaningful in that it conducted the first social cost-benefit analysis for these supporting drones. The analysis indicates that the cost of using drones is about one-tenth of the cost compared to the existing search centered on human resources, and that the manpower is 1/7th. With the rapid development of drone technology, the cost and labor savings are expected to be even greater. There are intangible benefits that can be found before the death of a missing person, including the reduction of cost and manpower, the rapid search of a wide range of people, and, among other things, searchable areas that are difficult for rescue workers to access. However, since this research does not have existing data, there may be limitations in external validity by conducting an analysis on one missing case. Future research will require more accurate costs and benefits from data collection and empirical research. 본 연구는 4차 산업혁명의 핵심 기술중의 하나인 드론이 공공영역에서 활용될 경우의 사회적 비용과 편익에 대해 분석을 실시하였다. 공공영역 활용 드론중 비교적 빠르게 현장에서 활용중인 경찰의 실종자 수색용 드론을 중심으로 논의를 전개하였다. 정부는 재난, 치안, 공공건설 등 다양한 공적 분야에서 드론을 활용할 계획을 세우고 집중적인 지원을 실시하고 있다. 본 연구에서는 이렇게 지원이 집중되고 있는 드론에 대한 최초의 사회적 비용·편익 분석을 실시하였다는데 그 의의가 있다고 할 수 있다. 분석에 따르면 드론을 활용할 경우 기존의 인력중심의 수색에 비하여 비용의 경우 1/10 수준이며, 인력은 1/7 수준으로 나타났다. 드론의 기술이 급속하게 발달하고 있는 만큼, 비용과 인력의 절감은 더욱 커 질것으로 예상이 된다. 비용과 인력의 절감과 더불어 수색인력의 손실을 방지할 수 있으며, 무엇보다도 광범위한 범위를 빠른 시간내에 수색할 수 있고, 구조 인력이 접근하기 어려운 지역까지 수색이 가능하여 실종자가 사망하기 전에 발견할 수 있는 무형의 편익이 있다. 그러나 본 연구는 기존의 자료가 없기 때문에 실종자 수색 1건을 대상으로 분석을 실시하여 외적타당도에 한계가 있을 수 있다. 향후 연구에서는 자료의 수집과 실증적인 연구를 통해 보다 정확한 비용과 편익이 이루어져야 할 것이다.

제품 카테고리 별 키워드 검색광고 반응 모델

방원희(Bang, Won-Hui),이동일(Lee, Dong Il),이혜준(Lee, Hyejun) 한국상품학회 2012 商品學硏究 Vol.30 No.4

본 연구의 목적은 기존의 광고 반응 모형을 통해 기본적인 키워드 검색광고 비용과 매출액과의 관계를 규명하고, 제품 카테고리별관리 특성의 상호작용효과를 검증하는 것이다. 기존의 키워드 검색광고 관련 연구는 대부분 실험과 설문조사 방식으로 이루어져 실제 집행된 키워드 검색광고 데이터를 분석에 활용한 연구는 상대적으로 적은 편이다. 따라서 본 연구는 A기업에서 키워드 검색광고를 집행한 실제 데이터를 활용하여 46개의 제품 카테고리의 24개월간 데이터를 분석하였다. 분석과정에서 여러 개의 제품 카테고리 별 관리 특성을 동시에 추정하기 위하여 위계적 선형 모형을 사용하였다. 위계적 선형 모형의 1수준 변수로 키워드 검색광고비용과 전환된 총 매출액과의 영향관계를 규명하고, 2수준 변수로 제품 카테고리별 관리 특성을 구성하여 광고비용과의 상호작용을 분석하였다. 분석결과, 키워드 검색광고의 광고 반응 형태는 기존의 광고반응 모형에 대한 선행연구들과 마찬가지로 광고비용과 매출액의 영향이 정의 관계를 나타내었다. 2수준 변수 중 평균 키워드 수, 평균 제품가격은 광고비용과의 상호작용에서 정의 관계를 나타내었고, 평균 CPC와 평균 CPS는 음의 관계를 나타내었다. 따라서 광고비용을 투입했을 때, 키워드 수가 많으며, 제품가격이 높은 특성을 지닌 제품 카테고리가 효과적임을 발견하였다. The purpose of this study is to identify the relationship between keyword Searching cost and converted total sales using advertising responsemodel with considering themoderating role of product category characteristics. Most studies of keyword search advertising have consisted of the experimental research model and quantity model, not based on actual field data analysis. Therefore this study analyzes the actual data of “A” company which is the online shopping mall to find out theoretic and practical suggestion points. This study applies hierarchical linear model. So the influence relationship between Keyword Searching cost and converted total sales is investigated as Level 1 variable, and product category characteristics of 46 product categories are used as Level 2 variables to define interactionwith advertising cost. As significance random-effect between Random-coefficient Model and Research Model had been reduced by Level 2 variables, product category characteristics, the interaction between Level 2 variables and advertising cost made influence to consideration of the difference of inter-group deviation. The results show that the characteristics of advertisement response of keyword search advertisement is similar to the prior studies of advertisement response, so the influence between total sales and advertising cost shows positive relationship. From 2 level variables, product characteristics variable, the average number of keyword and mean of product price shows positive relationship with advertising cost, whilemean CPC andmean CPS shows negative relationship.

인터넷포털의 사전규제 필요성과 시장획정: 인터넷검색광고 서비스를 중심으로

이상규 ( Sang Kyu Rhee ),이경원 ( Kyoung Won Rhee ) 정보통신정책학회 2015 정보통신정책연구 Vol.22 No.1

정보사회로 이행함에 따라 인터넷포털의 중요성이 증가하고 있으며, 인터넷포털 사업자의 영향력도 다방면에서 상당히 증가하고 있다. 이에 따라 최근 인터넷포털의 규제 당위성 및 필요성에 대한 논의가 지속적으로 제기 되고 있다. 일반적으로 기술진보가 매우 빠르고, 혁신의 결과에 따라 시장이 동적으로 변하는 산업에서 영향력이 큰 사업자에 대한 규제를 도입하고자 하는 경우에는 다른 시장에 비해더욱 신중을 기하여야 한다. 사용기술에 따라 제품이 차별화 되어 있고, 기술진보와 혁신에 의해 시장구조가 빠르게 변할 경우 시장지배력 판단을 위한 기초 작업인 시장획정에 오류가 발생할 가능성이 높으며, 역동적 시장에서 나타나는 새로운 유형의 행위들이 친경쟁적 행위인지 반경쟁적 행위인지를 판단하기 위한 이론도 명확히 정립되지 않아 잘못된 결정을 내릴 가능성이 높기 때문이다. 따라서 법집행 및 새로운 규제제도 도입의 필요성을 판단함에 있어 확실한 증거 및 치밀한 분석에 바탕을 둔 접근방법(evidence and analysis based approach)을 취해야 한다. 이러한 법규제 철학을 염두에 둔 것이 ‘오류 비용 체계’(error-cost framework)이다. 이러한 접근방식을 취하는 기저에는 시장기능이 자원을 효율적으로 배분하고, 사회후생을 극대화한다는 경제이론과 시장개입에는 반드시 오류와 비용이 수반된다는 신념이 있기 때문이다. 본 논문도 이와 같은 맥락에서 인터넷포털 시장에서 사전규제의 정당성 또는 필요성이 있는지를 판단해 보고, 최근 이슈가 되고 있는 인터넷포털의 검색사업에 대한 관련시장 획정에 대해 논의한다. In the process of rapid transition to an information society, Internet portals have an increasing importance and influence in many areas. Accordingly, the rationales and needs for regulation of Internet portals have been repeatedlydebated. This paper addresses two questions: “Should the internet portal industry be regulated like the telecommunication industry?” and “What is the rational way to define the market of online-search service provided by Internet portals in order to assess their market power?” In industries where technical progress is very fast and market changes dynamically with innovation, we argue that regulation of dominant firms should be crafted more carefully than in other industries. Moreover, when market structure changes rapidly with innovation, applying of regulation may be subject to errors due to difficulties in defining markets for the assessment of market power, and due to the lack of generally established economic theory for identifying whether new practices are anticompetitive. Thus, we suggest that approaches based on evidence and analysis be applied before introducing new regulation. This approach can be implemented through an error-cost framework reflecting a belief that market mechanisms can achieve efficiency, and regulatory interventions may be erroneous and costly. Regarding market definition of online-search service, as Internet portals’ main business, we emphasize that since Internet portals use a two-sided business model for online search consisting of both online-search service and search-based advertising, it is not appropriate to define their market as only consisting of online-search service and to assess market power in this business. Instead it is rational to consider Internet portals’ potential competition in both service areas.