Reference groups and product line decisions: An experimental investigation of limited editions and product proliferation

Some luxury goods manufacturers offer limited editions of their products, whereas some others market multiple product lines. Researchers have found that reference groups shape consumer evaluations of these product categories. Yet little empirical research has examined how reference groups affect the product line decisions of firms. Indeed, in a field setting it is quite a challenge to isolate reference group effects from contextual effects and correlated effects. In this paper, we propose a parsimonious model that allows us to study how reference groups influence firm behavior and that lends itself to experimental analysis. With the aid of the model we investigate the behavior of consumers in a laboratory setting where we can focus on the reference group effects after controlling for the contextual and correlated effects. The experimental results show that in the presence of strong reference group effects, limited editions and multiple products can help improve firms' profits. Furthermore, the trends in the purchase decisions of our participants point to the possibility that they are capable of introspecting close to two steps of thinking at the outset of the game and then learning through reinforcement mechanisms. © 2010 INFORMS.

The role of stimulus salience and attentional capture across the neural hierarchy in a stop-signal task.

Inhibitory motor control is a core function of cognitive control. Evidence from diverse experimental approaches has linked this function to a mostly right-lateralized network of cortical and subcortical areas, wherein a signal from the frontal cortex to the basal ganglia is believed to trigger motor-response cancellation. Recently, however, it has been recognized that in the context of typical motor-control paradigms those processes related to actual response inhibition and those related to the attentional processing of the relevant stimuli are highly interrelated and thus difficult to distinguish. Here, we used fMRI and a modified Stop-signal task to specifically examine the role of perceptual and attentional processes triggered by the different stimuli in such tasks, thus seeking to further distinguish other cognitive processes that may precede or otherwise accompany the implementation of response inhibition. In order to establish which brain areas respond to sensory stimulation differences by rare Stop-stimuli, as well as to the associated attentional capture that these may trigger irrespective of their task-relevance, we compared brain activity evoked by Stop-trials to that evoked by Go-trials in task blocks where Stop-stimuli were to be ignored. In addition, region-of-interest analyses comparing the responses to these task-irrelevant Stop-trials, with those to typical relevant Stop-trials, identified separable activity profiles as a function of the task-relevance of the Stop-signal. While occipital areas were mostly blind to the task-relevance of Stop-stimuli, activity in temporo-parietal areas dissociated between task-irrelevant and task-relevant ones. Activity profiles in frontal areas, in turn, were activated mainly by task-relevant Stop-trials, presumably reflecting a combination of triggered top-down attentional influences and inhibitory motor-control processes.