PurposeTo understand the new non-linear pricing in E-commerce. The present paper aims to put forth an idea of using tie-in agreement in the electronic commerce market in the name of trust in India. According to the Indian antitrust law, tie-in agreement is not allowed to use as compulsory in an offer to the buyer. This means that a tie-in agreement cannot be a compulsion or only an option to the buyer. This means it can be an extra option.Design/methodology/approachThe paper shows that using this logic the sellers are giving two options simultaneously to the buyer: (1) a commodity with a tie-in agreement and (2) the same commodity without a tie-in agreement. Therefore, there are two price mechanisms that are present. Now it is the decision of the buyer to choose between the two. These two price mechanisms create a new variable called trust. If the buyer selects the first option, then that buyer will not be treated as a trustworthy buyer, but in the second case, the buyer would be treated as a trustworthy or the affianced buyer. Therefore, the buyer would be leaning toward the second option. The paper proves that in the second option it would be difficult to minimize the consumer expenditure. As a result, there would be a situation of non-linear pricing in the name of trust which is hidden in the offer. The present work gives both theoretical models and empirical justifications.FindingsWe find that E-wallet is often used when a consumer orders food online but offline cash payment is preferred. Therefore, the offer does matter for the consumer. Hence, the offer can be used to make a tie-in arrangement. Therefore, even if there is a tie-in arrangement in online food servicing applications, the Competition Commission of India can restrict such practices as for illegal tying, the firm has to have the monopoly power in one market and there should be compulsory tie-arrangement in another market. But it does not mean that E-wallet tie-arrangement cannot be ignored as the monopoly power in the online food servicing market can influence the market share in the E-wallet market. Tie-in arrangement is also important, as the consumer has to spend more under cashback offer conditions which reduce the long-run gain of consumers.Originality/valueThe paper considered trust as a new element in forming non-linear pricing. This is new to this literature.
The relationship that exists between economic results and political institutions has been the subject of much discussion and debate. Both the nature of political institutions and the economic outcomes have a significant impact on one another. Political institutions have a considerable influence on the outcomes of economic activity, and economic outcome has a big impact on the nature of political institutions. In addition to their effects on the economy, political institutions have the potential to shape the characteristics of social institutions via their impact on the beliefs held by the populace. This research makes use of two different worldwide data sources: World Value Longitudinal Survey and Global State of Democracy Index by International Institute for Democracy and Electoral Assistance in addition to economic data in order to gain an understanding of the differences in the beliefs and values that are held by people living in the various political regimes. There are three key findings from this study. First, as a consequence of the change in political regimes, people's perspectives on the relative merits of equality and freedom tend to change. People with higher incomes place a higher emphasis on freedom than equality under authoritarian leadership more so than those with lower incomes. Second, the available research suggests that people from high income category have a tendency to put less weight on income equality than those who have low income, and this is consistent across various kinds of regimes. Third, in a democratic society, people with lower incomes put a larger value on income equality than those with higher incomes do across all regimes.
PurposeThe existence of the regional Kuznets curve, i.e. an inverted U-shaped relationship between regional disparity and economic development is widely debated and discussed. The bell-shaped curve of the spatial growth process where during the initial phase inequality increases and then reduces is theoretically supported by Myrdal (1957), Hirschman (1958), and Williamson (1965). It becomes important to understand regional Kuznets curve globally. Understanding the relationship between regional disparity and economic development becomes essential for public policy for balanced regional growth.Design/methodology/approachRegional Kuznets Curve which is an inverted U-shaped relationship between regional disparity and economic development is not a new phenomenon. Theoretical framework by Myrdal (1957), Hirschman (1958), and Williamson (1965) support the an inverted U-shaped relationship. To understand the relationship between regional disparity and economic development, the authors investigate the regional Kuznets curve by using data for 184 countries and 1765 subnational regions. Using parametric, semi-parametric, and non-parametric, it is found that there exists an inverted U-shaped relationship between regional disparity and economic development. The presence of the regional Kuznets curve is observed. As the theoretical framework suggests, regional inequality increases with income initially and decreases after attaining a certain level of income. This study identifies two stages of divergence-convergence where in the first stage, divergence across regions in a country happens with increasing income and in the later stage, convergence across regions in a country occurs with increasing income.FindingsUsing the parametric approach (panel data analysis), semi-parametric and non-parametric approaches, it is found that there exists a regional Kuznets curve. It is found that there exists an inverted-U relationship between regional inequality and per capita GNI. This suggests that the divergence-convergence passes through two stages. In the first stage, divergence across regions in a country happens with increasing income while in the later stage convergence occurs.Originality/valueThis research work has done three important things which fill the research gap that exists in the literature: (1) constructing the Gini coefficient to measure the regional inequality for 184 countries using 1765 subnational regional data; (2) using a parametric approach (panel data analysis) to understand the regional Kuznets phenomenon and (3) using a semi-parametric approach and non-parametric approach to understand the regional Kuznets phenomenon.
Recent studies have devoted great emphasis to examining the phenomenon of income convergence across regions. The empirical efforts made in the context of India look at convergence among the states of India. Although there have been a few studies done on the district level, the sub-state regions that are prevalent within each state have been largely ignored in the Indian regional literature. The purpose of this research is to investigate the extent to which 103 sub-state regions within 20 Indian states converge. This research adopts a method that differs from the conventional convergence strategy by instead focusing on the spatial convergence aspect. It has been shown that not only does spatial convergence but also β-convergence: a growth process where poor regions grow faster than rich regions occur among India's 103 different regions. This study sheds insight on the two distinct forms of convergence, namely, β-convergence across all regions, and β-convergence among neighbouring regions. The finding of the existence of β-convergence and spatial convergence among neighbouring regions invites policy attention regarding the development of backward regions.
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