Seminar (Dept. of Marketing)

Title: The Value of Being Smarter: An Empirical Study of IT-Enabled Smart Features in Vehicles

Speaker: Weining Bao（University of Connecticut）

Time:10:00-11:30am, November 27th (Wednesday), 2024

Venue:Room1008, Mingde Business Building

Language:English

Abstract：

As IT technologies continue to evolve, more and more products are being designed with smart features that are digital, connected, responsive, and intelligent. These features are capable of performing tasks that require human-like intelligence and adaptability in changing environments. We aim to quantify the heterogeneous value of two types of IT-enabled smart features in vehicles: smart driving and smart cabin. We develop and estimate a structural discrete choice demand model that captures how consumers make the preferred choice among a set of vehicle models that differ in their level of smartness. Our findings indicate that, on average, consumers are willing to pay CNY 4,142 for smart driving features, and CNY 20,070 for smart cabin features. However, we also find that consumers’ willingness to pay for smart cabin features is more heterogeneous, ranging from CNY -40,260 to CNY 89,780. This suggests that while some consumers highly value smart cabin features, others may not want them at all. Our counterfactual analysis shows that the presence of smart cabin features leads to larger profit increases for manufacturers and more welfare increase for consumers, compared with the presence of smart driving features.

Short biography：

Weining is a modeler who utilizes empirical and analytical models to investigate the strategic interactions among consumers, firms, and policymakers. His research focuses on understanding how consumers’ decision-making processes, firms’ competitive strategies, and policymakers’ regulatory frameworks interact to impact consumer well-being and contribute to social equality. Weining’s research is interdisciplinary and spans marketing, economics, and finance. His research has been published in the premier business journals such as Journal of Management Information Systems, Management Science, Marketing Science, and Production and Operations Management.