An analysis of optimal advertising under uncertainty

Article Abstract:

The managerial implications of a firm's optimal advertising decisions under conditions of uncertainty are analyzed. For the static one-period model, the results show that the potential divergence between advertising decisions under uncertainty and those under deterministic conditions depends on the firm's attitude toward risk. For the dynamic multi-period model with a quadratric response function which contains an unknown parameter, whether it is optimal for the firm to experiment at an advertising rate higher, equal to or lower than the myopic level depends on the specification of the response function, regardless of the nature of the firm's attitude toward risk. The assumption of a quadratric sales response function is supported by empirical results based on time-series data of twelve major brands of cigarettes.

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A new measure of attributable risk for public health applications

Article Abstract:

Risk management research frequently focuses on risk attribution and risk externalities; however, the multiple factors that combine to create risk are difficult to identify and analyze. Solutions for the problem of risk attribution are derived using game theory and the three basic principles of risk accounting. A mathematical model for risk attribution is provided. Among the risk situations considered by the research are the smoking of cigarettes as a public health hazard and factory emission of hazardous air pollutants.

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The logic of policy as argument

Article Abstract:

The problem of undercounting of minority populations in the U.S. Census statistics is considered from a Boolean algebraic system. This analysis seems to indicate buildup errors in the policy model proposed by Mitroff, Mason and Barabba in their research reported in the December 1982 Management Science magazine. The error detected by the Boolean analysis does not affect the original model's validity.

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