I am a PhD candidate at the University of Chicago. My main interests are sales tax policies, quantitative marketing, industrial organization, advertising, and media economics.
tel: (312) 952-5085
Long-Term Tax Salience Effects
This paper shows that consumers underreact to taxes that are not salient even in the long run, and reveals the trajectory of such effect over the number of store visits by consumers. Previous studies have suggested that tax salience effect may be persistent, but their evidence relied mostly on intertemporal variation in aggregate data. We use a novel consumer-level panel data in Japanese supermarket stores that include how the supermarket chains displayed their prices. The sample period coincides with the legal reform to relax the regulation that forced retailers to display the total price with sales tax. This regulatory reform provides a unique natural experiment, which allows us to estimate the causal effect on consumer behavior when sales tax is not shown. The difference-in-difference estimation shows that hiding a 5% sales tax increases individual sales value by 9.6% on a consumer's first visit after the change in price tags, but the treatment effect reduces sharply and stays stable around 3.8% on her second visit onwards. Consumers realize that price tags started to show only the base prices of products when they actually pay the total prices at cashiers on their first visits, which causes the sharp decline of the treatment effect. The fact that consumers' underreaction to sales tax remain after multiple store visits suggest that consumers intentionally ignore nonsalient taxes to avoid the cognitive cost of calculation. (JEL D12, H25, K34, L11)
Measuring the Return on Spot TV Commercials
Measuring the return on TV commercials is difficult since it requires a dataset that contains advertisement viewership and purchase behaviors of the same consumers. Detecting the advertising effect also requires a large sample size since effective advertising can involve very small changes in sales. We avoid these issues by measuring the return on TV commercials that promote other TV programs in Japan. Since promos on TV programs are prevalent in Japanese terrestrial TV, we observe a large number of pairs of advertising exposure and response by individual viewers in the data we use. There is also a peculiar business practice in the Japanese TV advertisement industry that is useful for an econometrician. Certain TV ad spots are sold with fixed price per viewership-second and this enables us to compare the commercial viewership a promo acquires in the targeted TV program and the commercial viewership it consumes. Fixed effects regression shows that one gross rating point (GRP) of a TV promotion yields more than one GRP when broadcasted in the same day as the promoted program, but less than one GRP when the promotion was broadcasted more than one day before the promoted program.
Media Capture and Reputation
Media is largely responsible for policy outcome since they provide most of the political information to the electorate. Politicians especially in developing countries are thus tempted to manipulate the media contents in order to control the election results. I develop a theory of media capture in which the reputation of the media works as a restraint. The model shows that media with more accurate information is less likely to accept bribes or benefits.