Academic literature on the topic 'Consumer Perceived Value'

This study seeks to evaluate customer perceived value in housing in order to increase the construction of housing value from the consumer’s point of view. A total of 240 houseowners in the middle to upper housings in Medan city, Indonesia, participated in this study. The data analysis used in this study is the Partial Least Square (PLS) approach. The results indicate that the perception of consumer value is strongly influenced by the economic value of the housing and the location function of the housing. Housing offered should be able to meet the needs of consumers and has the good mobility and accessibility. The emphasis that needs to be put in encouraging the perception of consumer value is the ability of the product in general, namely housing units in answering the needs of consumers.

This study investigate the structural relationship between the attributes, perceived value, consumer satisfaction, and repurchase intention of badminton products. This study based on empirical research argues as follows: ① The perceived value of equipment has a significant positive impact on perceived value for badminton consumers. ② Perceived value has a significant positive impact on consumer satisfaction. ③ Consumer satisfaction has a significant positive impact on repurchase intention. ④ Equipment attributes indirectly influence consumer satisfaction and repurchase intention through two paths: “badminton equipment attributes - perceived value - consumer satisfaction” or “badminton equipment attributes - perceived value - repurchase intention.” In other words, customer perceived value plays a mediating role in the relationship between badminton equipment attributes, consumer satisfaction, and repurchase intention. This study can provide a method to enhance consumer satisfaction and increase consumers' repurchase intention through the attributes of badminton products and the strengthening of customers' perceived value

Purpose The purpose of this paper is to examine the influence of perceived information and entertainment value, perceived credibility and perceived value on Generation Y consumers’ usage frequency of online consumer reviews. Design/methodology/approach The paper proposes and tests, with structural equation modelling analysis of moment structures, a research model using data from a large sample of Generation Y consumers. Findings The results confirm that Generation Y consumers perceive online reviews to be informative, entertaining, credible and valuable, and that they frequently consult such reviews. More specifically, the empirical analysis confirms that perceived information value, perceived entertainment value and perceived credibility significantly influenced the perceived value that Generation Y attach to online consumer reviews, which, in turn, was a significant predictor of their usage frequency of such reviews. Practical implications The results highlight the strategic importance of integrating online consumer reviews into the marketing communication mix when targeting Generation Y, together with the necessity of having filtering mechanisms to ensure that only authentic reviews are published and the need to implement tactics to ensure that such reviews are informative and entertaining and, consequently, of value. Originality/value This study contributes to marketers’ comprehension of strategically using online consumer reviews when targeting the Generation Y segment.

The intensive spread and the growth of the sharing economy challenge the sharing platforms to attract and retain consumers. Thus, a comprehensive understanding of consumers’ perceived value and marketing strategy oriented to value growth is becoming essential both from the scientific and practical point of view. However, in the scientific literature, the construct structure of consumer perceived value from sharing economy and the factors that determine it are not sufficiently explored. To fill this gap, this study aims to investigate consumer perceived value from sharing economy and explore how it is influenced by consumer environmental consciousness and consumer attitude towards sharing platforms. Based on the quantitative research findings, it was found that consumer environmental consciousness has a significant direct effect on attitude towards sharing economy platforms and directly influences consumer perceived social value. The results of this study confirm the mediating effect of the consumer attitude toward sharing platforms in the relationship between consumer environmental consciousness and consumer perceived economic, functional, emotional value from sharing economy.

Biodegradable packaging is gaining traction as a sustainable alternative. This study examines consumer perceptions of biodegradable packaging and their influence on product choices and satisfaction. A survey was conducted to measure perceived quality, value, consumer preferences, industry practices, and customer satisfaction. Correlation analysis revealed positive relationships between all constructs, suggesting that consumers who perceive higher quality and value in biodegradable packaging are also more likely to prefer it, be aware of industry practices related to it, and experience higher satisfaction with products using it. Regression analyses confirmed that perceived quality has a significant positive impact on choosing products with biodegradable packaging, and perceived value has a significant positive effect on consumer preference for it. However, only perceived quality directly influences customer satisfaction in this model. These findings suggest that both perceived quality and value are important for influencing consumer behavior toward biodegradable packaging. Firms can leverage these insights by focusing on enhancing packaging quality, clearly communicating its environmental benefits and product protection aspects, and educating consumers about its advantages. Further research is recommended to explore the potentially indirect role of perceived value and the influence of pricing strategies on consumer choices.

This manuscript explores the effect of Country-Of-Origin on perceived quality & perceived value. In automotive among Iranian consumers. Consumer attitudes to local and foreign products and the likely “country-oforigin" effect in Buy "Local" and "Made In ...” companies are surveyed. So, the importance of understanding differential consumer perception and evaluation of products has been well illustrated in consumer behaviour literature. The hypotheses of this research cover four main cores. Structured questionnaires and simple random sampling were used. A sample of 381 Iranian students in Selective University evaluate perceived quality associated with the value of vehicles came from Korea and Iran. Questionnaires were distributed with simple random sampling method Data were analyzed based on Statistical Package for Social Sciences (SPSS, V. 21). The author recommends future researchers examine the relations of the research in studies focusing on other products, markets.

Background: Webcast shopping is a novel marketing model in recent years, and in order to continuously expand the market scale, it has become an urgent need to fully explore consumers' purchase motivation and mobilize their purchase willingness to enhance their purchase behavior. According to SOR theory, stimulating consumers' perceived trust and perceived value to change, thus generating purchase intention and behavior. Anchor characteristics also play an important role in promoting consumer purchase behavior. Objective: To assess the effects of anchor characteristics on perceived trust and consumer purchase behavior, and to evaluate the mediating role of perceived trust and perceived value between anchor characteristics and consumer purchase behavior. Methods: An online questionnaire survey was conducted on a sample of 361 people who made purchases via webcasting in Liuzhou City, and partial least squares structural equation modeling was used to analyze the research objectives. Findings: Anchor characteristics have a positive effect on consumer buying behavior, anchor characteristics have a positive effect on perceived trust and perceived value, and perceived trust and perceived value have a positive effect on consumer buying behavior. Perceived trust and perceived value have a mediating role between anchor characteristics jade consumer purchase behavior. Contribution: This study expands the theoretical understanding of anchor characteristics and consumer purchase behavior, and extends the scope of the study to the commercial field. It also has some reference value in practice.

Most avocados consumed in France come from Peru or Chile. French suppliers vary based on the season; however, Chile is the main supplier of avocados during the winter season. The aim of this study is to analyze the key variables that influence French consumer satisfaction in the preference for Chilean avocados.This is substantiated using an exploratory multivariate analysis, which was performed on a causal model comprised of endogenous constructs: perceived extrinsic and intrinsic quality, perceived risk and perceived value. The sample consists of 346 French consumers of Chilean avocados in supermarkets of the Auvergne-Rhône-Alpes region. The main results show that the risk perceived by French consumers can only be related to the perceived extrinsic quality of the product. On the other hand, both perceived intrinsic and extrinsic quality are directly related to perceived value. Finally, it is concluded that French consumer satisfaction in the preference for Chilean avocados can be explained by the variables perceived intrinsic quality, perceived extrinsic quality and perceived value.

The aim of this study is to assess the extent of the influence of sales promotion on consumer purchasing decisions at the All-in-One Store in Batam City. This research employs an analytical descriptive method with the entire store's consumers as the study population. Data collection utilizes a questionnaire distributed to 100 respondents. The findings indicate that sales promotion significantly impacts consumer purchasing decisions at the All-in-One Store in Batam City. This suggests that effective promotional efforts can enhance consumers' interest and purchasing decisions at the store. The implications of this study underscore the need for improved and more targeted sales promotion strategies to support sales growth and consumer satisfaction at the All-in-One Store.

Within the UK retail sector, fashion shopping via mobiles is one of the fastest developing forms of online retail, yet recent research has shown that apparel retailers have been slow to implement appropriate mobile platforms into overall marketing strategies, thereby failing to satisfy consumer expectations and missing opportunities emerging through this channel. This research analyses mobile apparel retail from the consumer’s perspective. The aim is to understand fashion shopping experiences via smartphones. Research questions relate to the benefits fashion consumers are seeking through mobile shopping channels, how consumers shop, why they use smartphones and what influences their decision-making process. Consequently, a theory of interactive relationship between m-retail and consumer purchase behaviour has been developed. A mixed methods approach was adopted guided by Grounded Theory methodology complemented by experimental work. It applied 200 questionnaires, 1,313 mobile app reviews, 23 eye tracking experiments involving websites, mobile apps and mobile websites, 6 focus group discussions and 8 case studies. A conceptual model of Essential Features of Mobile Channel (EFMC) was developed by triangulating data gathered from a range of sources: eye tracking experiments, mobile app reviews and focus groups. Case studies of commercial platforms, implementing 43 features of EFMC, were used to evaluate mobile websites and apps developed by apparel retailers. This research contributes to knowledge by developing a Benefits-Value Theory (BVT), which addresses the relationship between levels of benefits and their influence on shopping involvement, by examining the ways consumers perceive mobile platforms and respond with distinctive behaviours and attitudes. This conceptual framework devotes what companies are doing on mobile and what consumers think about it. BVT provides a base for fashion consumer segmentation. Consumer profiles have been developed to account for shifts in consumer behaviour led by mobile technologies. This research proposes a model for diagnosing the strengths and weaknesses of mobile platforms. Shopping journey and behaviour models establish how to segment the consumer base, capturing a complexity of their behaviours, by assigning value to fashion retail. This research helps apparel retailers to develop appropriate marketing strategies in m-retail focusing on maximizing customer benefits and satisfaction by fulfilling retailers’ value creation and delivery.

The topic of my research is consumer brand equity (CBE). My thesis is that the success or otherwise of a brand is better viewed from the consumers’ perspective. I specifically focus on consumers as a unique group of stakeholders whose involvement with brands is crucial to the overall success of branding strategy. To this end, this research examines the constellation of ideas on brand equity that have hitherto been offered by various scholars. Through a systematic integration of the concepts and practices identified but these scholars (concepts and practices such as: competitiveness, consumer searching, consumer behaviour, brand image, brand relevance, consumer perceived value, etc.), this research identifies CBE as a construct that is shaped, directed and made valuable by the beliefs, attitudes and the subjective preferences of consumers. This is done by examining the criteria on the basis of which the consumers evaluate brands and make brand purchase decisions. Understanding the criteria by which consumers evaluate brands is crucial for several reasons. First, as the basis upon which consumers select brands changes with consumption norms and technology, understanding the consumer choice process will help in formulating branding strategy. Secondly, an understanding of these criteria will help in formulating a creative and innovative agenda for ‘new brand’ propositions. Thirdly, it will also influence firms’ ability to simulate and mould the plasticity of demand for existing brands. In examining these three issues, this thesis presents a comprehensive account of CBE. This is because the first issue raised in the preceding paragraph deals with the content of CBE. The second issue addresses the problem of how to develop a reliable and valid measuring instrument for CBE. The third issue examines the structural and statistical relationships between the factors of CBE and the consequences of CBE on consumer perceived value (CPV). Using LISREL-SIMPLIS 8.30, the study finds direct and significant influential links between consumer brand equity and consumer value perception.

Abstract A high level of customer perceived value is the key to customer loyalty and to the profitability of customers and companies. It is not enough to meet the customer's needs in order to win customer loyalty. Instead the aim for companies should be to try to delight customers. Customers are delighted when they feel that the product or service not only fulfils their needs and expectations, but also gives them unexpected additional value. Value has been studied widely and there are several different models and theories to describe customer perceived value. In the main, they tend to be too general or insufficient or they do not provide a useful guide for management practices. Therefore the aim of this thesis is to generate a theory for consumer perceived value which could be useful for managements trying to develop superior value so as to improve their customer loyalty. Pre-purchase consumer value was examined applying Grounded Theory methodology and by synthesizing the existing research results. The resulting theory from this synthesis consists of three main stages namely, gaining, sacrifice and purchase factors. The gaining stage has three sub elements: substance, reputation and interaction. All these sub-elements have the same four subcategories: emotional, social, functional and economical elements. What is novel about this research is its treatment of customer perceived value firstly, from the perspectives of the companies – based on three functionally different factors: substance, reputation and interaction – and secondly from the perspective of the customers based on the identified subjective outcomes (i.e. emotional, social, functional and economic factors). Based on this approach companies can develop products based on a better understanding of consumer perceived value.

The formation of alliances has become a key strategy for businesses wishing to grow. Yet the majority of these alliances fail. Most of the research into strategic alliances has focused on the benefits to the business itself, such as access to new markets, new technology or new knowledge. Surprisingly little research has examined the impact such alliances have on the customer, so we do not know if these alliances result in tangible benefits for customers that can be used to improve the outcomes of the alliance. The present study examined whether such an alliance added value to customers or improved their relationship with a service provider. The study found customers differentiated between

The standardised approach of producing fashion products in conjunction with the fast fashion trend has triggered a throwaway culture where premature disposal of well- functioning fashion products is a major problem. However, a shift has been revealed with the emerging demand for personalised fashion, as opposed to standardised garments. Generation Z is known for its urge to showcase personal identity, which makes this consumer group a driver in the growing trend of customisation. The relevance of customisation in fashion is further fuelled by its capability to enhance consumers’ emotional attachment towards the customised product, which often results in the product being kept longer. The perceived consumer value of customisation is acquired from the final product as well as the co-design process. The purpose of this study is to investigate Generation Z’s perceived value of customised fashion products and the co-design process. The underlying objective is to explore if the concept of customisation has the potential of becoming more established in the future fashion industry. The study follows an abductive reasoning and adopts a mixed method research with the explanatory sequential design. This mixed method design is a two-phase approach starting with the collection and analysis of quantitative data, followed by the compiling and analysis of qualitative data. For the first phase, a self-administered online questionnaire was conducted. The second phase entailed semi-structured interviews, which were designed to make up for obscure results in the survey. The Consumer Perceived Value Tool (CPVT) served as a theoretical lens for analysis and guided the construction of the data collection tools. By means of the CPVT the study found that Generation Z particularly perceive value in the utilitarian and creative-achievement benefits of customised fashion. Moreover, the perceived self-expressiveness and hedonic value were deemed significant to the generation. Generation Z showed little evidence of perceiving value in the uniqueness benefit of customised fashion. Lastly, an additional perceived value of customisation was proposed and is related to environmental sustainability, which is acquired from the benefit of acting more responsibly.

In today???s highly competitive business environment, client perceived value has become increasingly important to practitioners and business researchers as it is believed to be central to client decision-making, satisfaction and client retention. However, there are few insights as to what constitutes client perceived value and what are its antecedents, especially in the context of international, professional business-to-business (B2B) services. This study thus addressed two key questions: (i) what are the antecedents of client perceived value in an international, professional B2B service setting?; and (ii) how do these determinants influence client perceived performance and value under different contingency conditions (e.g., perceptions of country-oforigin (COO) and client experience)? The research was undertaken in two phases: Phase 1 included a literature review covering services marketing, international marketing, resource-based theory, contingency theory as well as an exploratory research amongst eight dyadic case studies. The objectives were to identify the key variables that contribute to client perceived performance and value; to fine tune the key constructs adopted from the literature; and to verify the linkage between the resource-based view (RBV) of a firm and client perceived value. By drawing on the theories mentioned above, and the results from the exploratory research, a conceptual model and a series of hypotheses were developed. The data used to test the model in Phase 2 was collected from 218 client firms in both Malaysia and Thailand. The data was collected through a mail survey with a net response rate of 32.9%, and was analysed via structural equation modelling, regression analysis and subgroup analysis. The results show that the key antecedents of perceived performance which in turn drives client value, included technical skills, customer orientation, innovation and firm reputation. The findings also suggest that COO moderates the relationships between these antecedents and perceived performance, while client experience moderates the association between perceived performance and value. The results provide a better understanding of value perceived by the B2B clients in an international setting. The academic contributions of this thesis are: the linkage of RBV and the services paradigm in an international context; the understanding of client perceived value and its antecedents; and the establishment of metric equivalence of measures employed across two countries (Malaysia and Thailand). Finally, the managerial contributions include guidance for exporting firms in terms of resource allocation to achieve competitive advantage; utilising the COO effect in promotion; and managing client value perceptions in international markets.

This research attempted to discover how Additive Manufacturing (AM) can best be used to increase the value of personalised consumer products and how designers can be assisted in finding an effective way to facilitate value addition within personalisable product designs. AM has become an enabler for end-users to become directly involved in product personalisation through the manipulation of three-dimensional (3D) designs of the product using easy-to-use design toolkits. In this way, end-users are able to fabricate their own personalised designs using various types of AM systems. Personalisation activity can contribute to an increment in the value of a product because it delivers a closer fit to user preferences. The research began with a literature review that covered the areas of product personalisation, additive manufacturing, and consumer value in product design. The literature review revealed that the lack of methods and tools to enable designers to exploit AM has become a fundamental challenge in fully realising the advantages of the technology. Consequently, the question remained as to whether industrial designers are able to identify the design characteristics that can potentially add value to a product, particularly when the product is being personalised by end-users using AM-enabled design tools and systems. A new value taxonomy was developed to capture the relevant value attributes of personalised AM products. The value taxonomy comprised two first-level value types: product value and experiential value. It was further expanded into six second-level value components: functional value, personal-expressive value, sensory value, unique value, co-design value, and hedonic value. The research employed a survey to assess end-users value reflection on personalised features; measuring their willingness to pay (WTP) and their intention to purchase a product with personalised features. Thereafter, an experimental study was performed to measure end-users opinions on the value of 3D-printed personalised products based on the two value types: product value and experiential value. Based on the findings, a formal added value identification method was developed to act as a design aid tool to assist designers in preparing a personalisable product design that embodies value-adding personalisation features within the product. The design method was translated into a beta-test version paper-based design workbook known as the V+APP Design Method: Design Workbook. The design aid tool was validated by expert designers. In conclusion, this research has indicated that the added value identification method shows promise as a practical and effective method in aiding expert designers to identify the potential value-adding personalisation features within personalisable AM products, ensuring they are able to fully exploit the unique characteristics and value-adding design characteristics enabled by AM. Finally, the limitations of the research have been explained and recommendations made for future work in this area.

This essay focus on the development and implementation of a model to evaluate consumer perceived value. Initially, itâs discussed the perceived value concept, its importance under strategy and marketing perspectives and its relation to price and quality. The model is presented, considering each step to be followed: perceived quality study of brands in the market; consumerâs perceptions of competitorâs prices; and the value map development, defined considering the relation quality/price for each brand in the market. The model applicability was tested in a soft drink category study in Fortaleza market, based in a survey with 400 consumers. The application shows that the model, built under consumerâs point of view, can provide a descriptive panel of competitorâs positions and relevant information to be used in market diagnoses. The information and the descriptive panel mentioned can be useful, not only in strategic analyses, but also in price formulations.<br>Esta dissertaÃÃo està centrada no desenvolvimento e utilizaÃÃo de um modelo para a avaliaÃÃo do valor percebido pelos consumidores. Inicialmente, à discutido o conceito de valor percebido, sua importÃncia sob as perspectivas estratÃgicas e mercadolÃgicas e sua relaÃÃo com o preÃo e a qualidade. O modelo à apresentado a partir da descriÃÃo dos passos necessÃrios para sua aplicaÃÃo: o estudo da qualidade percebida de cada marca; o levantamento das percepÃÃes dos consumidores com relaÃÃo aos preÃos dos concorrentes; e o desenho do mapa de valor, que à traÃado a partir das relaÃÃes qualidade/preÃo definidas para cada marca do mercado. A aplicabilidade do modelo foi testada atravÃs de um estudo da categoria de refrigerantes no mercado de Fortaleza, que envolveu uma pesquisa do tipo survey junto a 400 consumidores. Verificou-se que o modelo fornece um quadro descritivo dos posicionamentos mercadolÃgicos dos concorrentes e outras informaÃÃes relevantes para o diagnÃstico de mercado, considerado sob a Ãptica dos consumidores. As informaÃÃes e o quadro descritivo citados podem ser utilizados para anÃlises e formulaÃÃes estratÃgicas e para a formaÃÃo de preÃos.

Background: The slow fashion industry arose as a contraposition to the unsustainable ways of fast fashion, and emphasizes attentive consumption and production. It is characterized by four characteristics - transparency, quality, localism and exclusivity – each described with valuable traits in previous studies. However, current marketing efforts of slow fashion are focused only on two transparency aspects; sustainability and ethics, although previous studies show that these have no influence on consumers consumption choices. Therefore, this study aims to explore which aspects within these four characteristics that are perceived as valuable by consumers, so that a value package model for the consumer perceived valuable aspects of slow fashion can be developed. Purpose: The purpose of this thesis is to develop a new value package model that presents the consumer perceived valuable aspects of slow fashion. Methodology: This exploratory qualitative study was conducted through nine semi-structured interviews with Swedish fashion consumers between the age of 18-26. The participants were selected through convenience sampling, and the interviews resulted in 91 pages of collected data. The data was then analyzed with the help of thematic coding. The findings derived from the study was then used to develop a new value package model; presenting the consumer perceived valuable aspects of slow fashion. Findings: There were six consumer perceived value aspects of slow fashion. These were, in order of highest influence to lowest; classical style, product personality, durability, limited production, security and knowledge. Conclusion: This study contributes with the theoretical implication of a new proposed value package model that displays the customer perceived value aspects of slow fashion. In addition, it provides managerial implications that may help marketers and companies to streamline their marketing efforts of slow fashion.

Up until recently, the role of the customer in economic geography seems to have been confined to a passive recipient of products at the end of the value chain. Innovation, in particular, has been conceived as an affair within and between firms. More recently, however, this traditional perception has been challenged. Consumers, in fact, are no longer seen as mere buyers of commodities but are more and more perceived (and perceive themselves) as competent users who contribute valuable knowledge to innovation processes and who have the power and capacity to intervene at all stages in the value creation process. Value co-creation has emerged as a new paradigm that signifies this transformation of the role of consumers. The prime aim of this chapter is to map out the evolving terrain of value co-creation and to draw conclusions for economic geographical inquiry into innovation processes.

In a vast society where environmentally conscious nonfarming voters and consumers have grown to greatly outnumber those directly engaged in agriculture, what happens in agriculture becomes increasingly subject to control by the general society, as policies and laws cater to constituents and consumers. This book provides an overview of how Americans perceive and value farmers and examines public opinion with regard to a number of agricultural issues. Based on analysis of national survey data, the authors offer an empirically based discussion and interpretation of those views and perceptions that help to shape policy and social sustainability. This unique collection illustrates that in addition to its natural, biological, and economic risks, agriculture has social risks that reverberate through all levels of society. As the general population grows and the number of farms and farmers diminishes, the weight of public opinion becomes more important in the policy arena of society as well as in the market demands for food and fiber grown in safe and favorable environmental conditions. Setting the stage with a consideration of the larger society's interests in agricultural issues and of social and agricultural interdependence, the contributors cover a range of topics and issues affecting agriculture at the end of the 20th century. Chapters examine public perceptions of government's role in farming; support for an environmentally friendly agricultural system; views on pesticides and chemicals in foods; consumer attitudes on food safety; threats to clean drinking water, concerns over farm animal welfare; and the basic agrarian ethic of American society. The book concludes with a look to the future of the social risks of agriculture in the 21st century.

This chapter discusses how copious excretion and vomit feature in popular animator Miyazaki Hayao's Academy-award winning feature Spirited Away (2001), arguing that these bodily eruptions are critiques of rampant consumer capitalism in contemporary Japan. Set in a carnivalesque world revolving around a luxurious bathhouse for gods of all shapes and sizes, the film repeatedly portrays scenes of food excess, denial, and expulsion, which can be interpreted as anorexia and bulimia. The chapter sees the eating frenzies depicted as Miyazaki's metaphor for materialistic overconsumption, and perceives the strong work ethic and self-denial that bring about the protagonist Sen's salvation as Miyazaki's call for a return to traditional values.

Youth and Rock in the Soviet Bloc explores the rise of youth as consumers of popular culture and the globalization of popular music in Russia and Eastern Europe. This collection of essays challenges assumptions that Communist leaders and Western-influenced youth cultures were inimically hostile to one another. While initially banning Western cultural trends like jazz and rock-and-roll, Communist leaders accommodated elements of rock and pop music to develop their own socialist popular music. They promoted organized forms of leisure to turn young people away from excesses of style perceived to be Western. Popular song and officially sponsored rock and pop bands formed a socialist beat that young people listened and danced to. Young people attracted to the music and subcultures of the capitalist West still shared the values and behaviors of their peers in Communist youth organizations. Despite problems providing youth with consumer goods, leaders of Soviet bloc states fostered a socialist alternative to the modernity the capitalist West promised. Underground rock musicians thus shared assumptions about culture that Communist leaders had instilled. Still, competing with influences from the capitalist West had its limits. State-sponsored rock festivals and rock bands encouraged a spirit of rebellion among young people. Official perceptions of what constituted culture limited options for accommodating rock and pop music and Western youth cultures. Youth countercultures that originated in the capitalist West, like hippies and punks, challenged the legitimacy of Communist youth organizations and their sponsors. Government media and police organs wound up creating oppositional identities among youth gangs. Failing to provide enough Western cultural goods to provincial cities helped fuel resentment over the Soviet Union’s capital, Moscow, and encourage support for breakaway nationalist movements that led to the Soviet Union’s collapse in 1991. Despite the Cold War, in both the Soviet bloc and in the capitalist West, political elites responded to perceived threats posed by youth cultures and music in similar manners. Young people participated in a global youth culture while expressing their own local views of the world.

Equally reviled and revered as “Sin City,” Las Vegas is both exceptional and emblematic of contemporary American cultural practices and tastes. Michael Ian Borer takes us inside the burgeoning Las Vegas craft beer scene to witness how locals use craft beer to create and foster not just a local culture but a locals’ culture. Through compelling detailed ethnographic accounts and interviews, Vegas Brews provides an unprecedented look into the ways that brewers, distributors, bartenders, and drinkers fight against the perceived and preconceived norm about what “happens in Vegas” and lay claim to a part of their city that is too often overshadowed by the bright lights of tourist sites. In doing so, Borer shows how our interactions with the things we care about—and the ways that we care about how they’re made, treated, and consumed—can lead to new senses of belonging and connections with and to others and the places where we live. In a world where people and things move around at an extraordinary rate, the folks Borer spent time talking (and drinking) with remind us to slow down and learn how to taste the “good life,” or at least a semblance of it, even in a city where style is often valued over substance.

Written by two highly successful business coaches and management consultants, this book explains how to improve profitability by focusing on turning a business's already satisfied customers into highly satisfied customers by removing their sense of risk. The authors also provide a fail-safe method for identifying the risks inherent in your business. Every business owner or manager knows that creating satisfied customers is key to establishing customer loyalty and building a business. But many are applying the wrong strategy in trying to achieve customer loyalty: instead of focusing on consistent execution of the company's value proposition on a day-to-day basis, they waste their efforts constantly chasing after new customers or trying to address every complaint. Using research to demonstrate how striving to turn merely satisfied customers into highly satisfied customers significantly affects loyalty behaviors and in turn boosts profits, Capturing Loyalty lays out a new approach to a very old problem. Additionally, it presents a blueprint for identifying the perceived risks to consumers inherent in your business―many of which are not readily apparent to the casual or even invested observer―and explains how to minimize those risks. Authors Larson and McClellan explain why trying to ensure 100% customer satisfaction is not the path to achieving customer loyalty, and that the reality is that customer dissatisfaction is rarely the result of an error a business has made―two concepts that many initially find counterintuitive. You'll learn how to offer your company's products and services in a manner that creates highly satisfied customers, understand the true value and vast economic benefits of having highly satisfied customers, and see why highly satisfied customers are actually cheaper to serve than others. The book presents a clear and comprehensive plan for creating a loyalty initiative suitable to your business and cascading it through your entire organization, from the C-suite to the line employees.

Abstract Economic pressures on the refining industry are forcing many refiners to look at lower priced high acid crudes to improve margins. These crudes may be discounted because they are perceived to cause increased corrosion or fouling problems, or simply because they are new or unknown to the market. If these problems are not properly managed or understood, the benefits of lower price may be consumed by higher processing costs or by the deterioration of the assets caused by corrosion. To safely process these high acid crudes, a comprehensive multi-discipline service has been implemented to identify, assess and mitigate the corrosion, fouling and processing risks associated with these crudes. This service covers all the aspects that are necessary to optimize the economics of processing corrosive crudes, such as materials selection, corrosion inhibition, process control, corrosion monitoring, inspection, and scheduling. In addition to managing the potential corrosion problems, it also addresses key issues such as crude oil selection strategy, the true value and cost of processing the crudes, an evaluation of the refinery's blending capabilities, the compatibility of various crudes, the quality of products, etc. This paper provides an overview of the strategic issues associated with processing high acid crudes and several case histories describing the benefits gained from using this approach.

This study explores the relationship between personal values (biospheric, altruistic, egoistic, and hedonic) and perceived obsolescence of high-tech consumer products. Obsolescence, characterized by the loss of product value, functionality, or desirability, is a significant concern in the consumer technology sector, influencing product life cycles and consumer demand. The study proposes that the degree of perceived obsolescence may differ based on individuals' personal values. For example, individuals who strongly endorse biospheric values may be less likely to replace their smartphones, while those who strongly endorse egoistic values may be more likely to do so. The study employs "Multivariate Analysis of Variance" to examine the relationship between personal values and the perceived obsolescence types (economic, functional, technological, and aesthetic). A representative sample of individuals who have voluntarily replaced their working smartphones will be recruited, and personal values will be measured using a validated value scale. The study expects to find significant differences in the perceived importance of obsolescence types among individuals with varying personal values. The findings may help manufacturers adapt their strategies to effectively meet consumer demands and foster long-term relationships with their target audience while addressing the environmental concerns associated with rapid product obsolescence.

This paper explores the merits of introducing a retail central bank digital currency (CBDC) in Australia, focusing on the extent to which consumers would value having access to a digital form of money that is even safer and potentially more private than commercial bank deposits. To conduct our exploration we run a discrete choice experiment, which is a technique designed specifically for assessing public valuations of goods without markets. The results suggest that the average consumer attaches no value to the added safety of a CBDC. This is consistent with bank deposits in Australia already being perceived as a safe form of money, and physical cash issued by the Reserve Bank of Australia continuing to be available as an alternative option. Privacy settings of a CBDC, which can take various forms, look more consequential for the CBDC value proposition. We find no clear relationship between safety or privacy valuations and the degree of consumers' cash use.

Executive Summary This report describes a series of experiments carried out by PRICE Lab, a research programme at the Economic and Social Research Institute (ESRI) jointly funded by the Central Bank of Ireland, the Commission for Energy Regulation, the Competition and Consumer Protection Commission and the Commission for Communications Regulation. The experiments were conducted with samples of Irish consumers aged 18-70 years and were designed to answer the following general research question: At what point do products become too complex for consumers to choose accurately between the good ones and the bad ones? BACKGROUND AND METHODS PRICE Lab represents a departure from traditional methods employed for economic research in Ireland. It belongs to the rapidly expanding area of ‘behavioural economics’, which is the application of psychological insights to economic analysis. In recent years, behavioural economics has developed novel methods and generated many new findings, especially in relation to the choices made by consumers. These scientific advances have implications both for economics and for policy. They suggest that consumers often do not make decisions in the way that economists have traditionally assumed. The findings show that consumers have limited capacity for attending to and processing information and that they are prone to systematic biases, all of which may lead to disadvantageous choices. In short, consumers may make costly mistakes. Research has indeed documented that in several key consumer markets, including financial services, utilities and telecommunications, many consumers struggle to choose the best products for themselves. It is often argued that these markets involve ‘complex’ products. The obvious question that arises is whether consumer policy can be used to help them to make better choices when faced with complex products. Policies are more likely to be successful where they are informed by an accurate understanding of how real consumers make decisions between products. To provide evidence for consumer policy, PRICE Lab has developed a method for measuring the accuracy with which consumers make choices, using techniques adapted from the scientific study of human perception. The method allows researchers to measure how reliably consumers can distinguish a good deal from a bad one. A good deal is defined here as one where the product is more valuable than the price paid. In other words, it offers good value for money or, in the jargon of economics, offers the consumer a ‘surplus’. Conversely, a bad deal offers poor value for money, providing no (or a negative) surplus. PRICE Lab’s main experimental method, which we call the ‘Surplus Identification’ (S-ID) task, allows researchers to measure how accurately consumers can spot a surplus and whether they are prone to systematic biases. Most importantly, the S-ID task can be used to study how the accuracy of consumers’ decisions changes as the type of product changes. For the experiments we report here, samples of consumers arrived at the ESRI one at a time and spent approximately one hour doing the S-ID task with different kinds of products, which were displayed on a computer screen. They had to learn to judge the value of one or more products against prices and were then tested for accuracy. As well as people’s intrinsic motivation to do well when their performance on a task like this is tested, we provided an incentive: one in every ten consumers who attended PRICE Lab won a prize, based on their performance. Across a series of these experiments, we were able to test how the accuracy of consumers’ decisions was affected by the number and nature of the product’s characteristics, or ‘attributes’, which they had to take into account in order to distinguish good deals from bad ones. In other words, we were able to study what exactly makes for a ‘complex’ product, in the sense that consumers find it difficult to choose good deals. FINDINGS Overall, across all ten experiments described in this report, we found that consumers’ judgements of the value of products against prices were surprisingly inaccurate. Even when the product was simple, meaning that it consisted of just one clearly perceptible attribute (e.g. the product was worth more when it was larger), consumers required a surplus of around 16-26 per cent of the total price range in order to be able to judge accurately that a deal was a good one rather than a bad one. Put another way, when most people have to map a characteristic of a product onto a range of prices, they are able to distinguish at best between five and seven levels of value (e.g. five levels might be thought of as equivalent to ‘very bad’, ‘bad’, ‘average’, ‘good’, ‘very good’). Furthermore, we found that judgements of products against prices were not only imprecise, but systematically biased. Consumers generally overestimated what products at the top end of the range were worth and underestimated what products at the bottom end of the range were worth, typically by as much as 10-15 per cent and sometimes more. We then systematically increased the complexity of the products, first by adding more attributes, so that the consumers had to take into account, two, three, then four different characteristics of the product simultaneously. One product might be good on attribute A, not so good on attribute B and available at just above the xii | PRICE Lab: An Investigation of Consumers’ Capabilities with Complex Products average price; another might be very good on A, middling on B, but relatively expensive. Each time the consumer’s task was to judge whether the deal was good or bad. We would then add complexity by introducing attribute C, then attribute D, and so on. Thus, consumers had to negotiate multiple trade-offs. Performance deteriorated quite rapidly once multiple attributes were in play. Even the best performers could not integrate all of the product information efficiently – they became substantially more likely to make mistakes. Once people had to consider four product characteristics simultaneously, all of which contributed equally to the monetary value of the product, a surplus of more than half the price range was required for them to identify a good deal reliably. This was a fundamental finding of the present experiments: once consumers had to take into account more than two or three different factors simultaneously their ability to distinguish good and bad deals became strikingly imprecise. This finding therefore offered a clear answer to our primary research question: a product might be considered ‘complex’ once consumers must take into account more than two or three factors simultaneously in order to judge whether a deal is good or bad. Most of the experiments conducted after we obtained these strong initial findings were designed to test whether consumers could improve on this level of performance, perhaps for certain types of products or with sufficient practice, or whether the performance limits uncovered were likely to apply across many different types of product. An examination of individual differences revealed that some people were significantly better than others at judging good deals from bad ones. However the differences were not large in comparison to the overall effects recorded; everyone tested struggled once there were more than two or three product attributes to contend with. People with high levels of numeracy and educational attainment performed slightly better than those without, but the improvement was small. We also found that both the high level of imprecision and systematic bias were not reduced substantially by giving people substantial practice and opportunities to learn – any improvements were slow and incremental. A series of experiments was also designed to test whether consumers’ capability was different depending on the type of product attribute. In our initial experiments the characteristics of the products were all visual (e.g., size, fineness of texture, etc.). We then performed similar experiments where the relevant product information was supplied as numbers (e.g., percentages, amounts) or in categories (e.g., Type A, Rating D, Brand X), to see whether performance might improve. This question is important, as most financial and contractual information is supplied to consumers in a numeric or categorical form. The results showed clearly that the type of product information did not matter for the level of imprecision and bias in consumers’ decisions – the results were essentially the same whether the product attributes were visual, numeric or categorical. What continued to drive performance was how many characteristics the consumer had to judge simultaneously. Thus, our findings were not the result of people failing to perceive or take in information accurately. Rather, the limiting factor in consumers’ capability was how many different factors they had to weigh against each other at the same time. In most of our experiments the characteristics of the product and its monetary value were related by a one-to-one mapping; each extra unit of an attribute added the same amount of monetary value. In other words, the relationships were all linear. Because other findings in behavioural economics suggest that consumers might struggle more with non-linear relationships, we designed experiments to test them. For example, the monetary value of a product might increase more when the amount of one attribute moves from very low to low, than when it moves from high to very high. We found that this made no difference to either the imprecision or bias in consumers’ decisions provided that the relationship was monotonic (i.e. the direction of the relationship was consistent, so that more or less of the attribute always meant more or less monetary value respectively). When the relationship involved a turning point (i.e. more of the attribute meant higher monetary value but only up to a certain point, after which more of the attribute meant less value) consumers’ judgements were more imprecise still. Finally, we tested whether familiarity with the type of product improved performance. In most of the experiments we intentionally used products that were new to the experimental participants. This was done to ensure experimental control and so that we could monitor learning. In the final experiment reported here, we used two familiar products (Dublin houses and residential broadband packages) and tested whether consumers could distinguish good deals from bad deals any better among these familiar products than they could among products that they had never seen before, but which had the same number and type of attributes and price range. We found that consumers’ performance was the same for these familiar products as for unfamiliar ones. Again, what primarily determined the amount of imprecision and bias in consumers’ judgments was the number of attributes that they had to balance against each other, regardless of whether these were familiar or novel. POLICY IMPLICATIONS There is a menu of consumer polices designed to assist consumers in negotiating complex products. A review, including international examples, is given in the main body of the report. The primary aim is often to simplify the consumer’s task. Potential policies, versions of which already exist in various forms and which cover a spectrum of interventionist strength, might include: the provision and endorsement of independent, transparent price comparison websites and other choice engines (e.g. mobile applications, decision software); the provision of high quality independent consumer advice; ‘mandated simplification’, whereby regulations stipulate that providers must present product information in a simplified and standardised format specifically determined by regulation; and more strident interventions such as devising and enforcing prescriptive rules and regulations in relation to permissible product descriptions, product features or price structures. The present findings have implications for such policies. However, while the experimental findings have implications for policy, it needs to be borne in mind that the evidence supplied here is only one factor in determining whether any given intervention in markets is likely to be beneficial. The findings imply that consumers are likely to struggle to choose well in markets with products consisting of multiple important attributes that must all be factored in when making a choice. Interventions that reduce this kind of complexity for consumers may therefore be beneficial, but nothing in the present research addresses the potential costs of such interventions, or how providers are likely to respond to them. The findings are also general in nature and are intended to give insights into consumer choices across markets. There are likely to be additional factors specific to certain markets that need to be considered in any analysis of the costs and benefits of a potential policy change. Most importantly, the policy implications discussed here are not specific to Ireland or to any particular product market. Furthermore, they should not be read as criticisms of existing regulatory regimes, which already go to some lengths in assisting consumers to deal with complex products. Ireland currently has extensive regulations designed to protect consumers, both in general and in specific markets, descriptions of which can be found in Section 9.1 of the main report. Nevertheless, the experiments described here do offer relevant guidance for future policy designs. For instance, they imply that while policies that make it easier for consumers to switch providers may be necessary to encourage active consumers, they may not be sufficient, especially in markets where products are complex. In order for consumers to benefit, policies that help them to identify better deals reliably may also be required, given the scale of inaccuracy in consumers’ decisions that we record in this report when products have multiple important attributes. Where policies are designed to assist consumer decisions, the present findings imply quite severe limits in relation to the volume of information consumers can simultaneously take into account. Good impartial Executive Summary | xv consumer advice may limit the volume of information and focus on ensuring that the most important product attributes are recognised by consumers. The findings also have implications for the role of competition. While consumers may obtain substantial potential benefits from competition, their capabilities when faced with more complex products are likely to reduce such benefits. Pressure from competition requires sufficient numbers of consumers to spot and exploit better value offerings. Given our results, providers with larger market shares may face incentives to increase the complexity of products in an effort to dampen competitive pressure and generate more market power. Where marketing or pricing practices result in prices or attributes with multiple components, our findings imply that consumer choices are likely to become less accurate. Policymakers must of course be careful in determining whether such practices amount to legitimate innovations with potential consumer benefit. Yet there is a genuine danger that spurious complexity can be generated that confuses consumers and protects market power. The results described here provide backing for the promotion and/or provision by policymakers of high-quality independent choice engines, including but not limited to price comparison sites, especially in circumstances where the number of relevant product attributes is high. A longer discussion of the potential benefits and caveats associated with such policies is contained in the main body of the report. Mandated simplification policies are gaining in popularity internationally. Examples include limiting the number of tariffs a single energy company can offer or standardising health insurance products, both of which are designed to simplify the comparisons between prices and/or product attributes. The present research has some implications for what might make a good mandate. Consumer decisions are likely to be improved where a mandate brings to the consumer’s attention the most important product attributes at the point of decision. The present results offer guidance with respect to how many key attributes consumers are able simultaneously to trade off, with implications for the design of standardised disclosures. While bearing in mind the potential for imposing costs, the results also suggest benefits to compulsory ‘meta-attributes’ (such as APRs, energy ratings, total costs, etc.), which may help consumers to integrate otherwise separate sources of information. FUTURE RESEARCH The experiments described here were designed to produce findings that generalise across multiple product markets. However, in addition to the results outlined in this report, the work has resulted in new experimental methods that can be applied to more specific consumer policy issues. This is possible because the methods generate experimental measures of the accuracy of consumers’ decision-making. As such, they can be adapted to assess the quality of consumers’ decisions in relation to specific products, pricing and marketing practices. Work is underway in PRICE Lab that applies these methods to issues in specific markets, including those for personal loans, energy and mobile phones.

The Advisory Committee on Social Sciences (ACSS) was established by the Food Standards Agency (FSA) to bring social science expertise to the Agency’s pursuit of food safety, food authenticity, and regulatory excellence. In fulfilling its remit, the Agency needs advice from a wide range of expertise, and this includes insights from disciplines such as behavioural science and economics as much as from the medical, agricultural, and animal health domains. It is crucial to understand how we as consumers, as well as the industries that feed us, might adapt our behaviours, perceive risks or alter our purchasing patterns. Climate Change is now widely accepted as one of the gravest risks facing human well-being, not least because of its possible effects on the food system. These effects could be radical and sudden and are inherently unpredictable. At the same time, humans are extraordinarily adaptable and innovative, and so responses to this threat are also unpredictable. Many people are already ‘doing their bit’ towards the ‘Net Zero’ aspiration by adapting their diet, changing their consumption patterns, or striving to avoid waste. As one of the many governmental bodies concerned with food supply the FSA has a strong interest in horizon scanning likely responses to climate change and understanding where it might impact its work. The ACSS therefore offered to help with this large task and formed a Working Group on Climate Change and Consumer Behaviours (CCCB). We were fortunate to be able to begin our work by hosting a workshop with experts in the field to illuminate the trends already being observed, or considered possible. Following this we then convened a group of colleagues across the FSA to deepen understanding of how the identified trends might impact on food safety, food authenticity and regulation. We took as our initial scope end consumers (rather than the businesses that serve them), and we looked for behaviours that appear to be ones that consumers have adopted to respond to the Net Zero call. The concepts of ‘choice’ and ‘preference’ in relation to behaviour is complex, as much behaviour does not follow choice or preference. In future, climate change may bring about changes to food availability and price that mean that choices are constrained. Equally, consumer preferences may feed back into the supply chain, and lead to a degree of choice ‘editing’ by food businesses. These complexities are beyond our scope for the moment, but, as experts participating in our workshop emphasized, must be considered. To get the full value of the expertise we were able to assemble, and the added value from our consultants, Ipsos UK who constructed and ran the first workshop, it is important to read the full report. It is also important to go directly to the centres of expertise for the insights that surfaced, but that we could only dip into and summarise. In this overview, the CCCB working group wants to highlight what we felt were some of the most interesting lines of enquiry, which are shown in table 1 below. We have to stress that these are possible trends of concern to the FSA, not necessarily with already observable effects, and more work needs to be done to explore them. We are conscious that the Science Council also has a WG on Net Zero, with a wider scope than that of the ACSS, and we are closely in touch to ensure that the work is complementary. I would therefore like to commend the work of the ACSS CCCB working group to the FSA, and we look forward to discussing how we can be of further help. I would also like to wholeheartedly thank everyone involved in making the workshops such stimulating and insightful exercises.

Macroeconomic summary The Colombian economy sustained numerous shocks in the second quarter, pri¬marily related to costs and supply. The majority of these shocks were unantic¬ipated or proved more persistent than expected, interrupting the recovery in economic activity observed at the beginning of the year and pushing overall inflation above the target. Core inflation (excluding food and regulated items) increased but remained low, in line with the technical staff’s expectations. A third wave of the pandemic, which became more severe and prolonged than the previous outbreak, began in early April. This had both a high cost in terms of human life and a negative impact on Colombia's economic recovery. Between May and mid-June roadblocks and other disruptions to public order had a sig¬nificant negative effect on economic activity and inflation. The combination and magnitude of these two shocks likely led to a decline in gross domestic product (GDP) compared to the first quarter. Roadblocks also led to a significant in¬crease in food prices. The accumulated effects of global disruptions to certain value chains and increased international freight transportation prices, which since the end of 2020 have restricted supply and increased costs, also affected Colombia’s economy. The factors described above, which primarily affected the consumer price index (CPI) for goods and foods, explain to a significant degree the technical staff’s forecast errors and the increase in overall inflation above the 3% target. By contrast, increases in core inflation and in prices for regulated items were in line with the technical staff’s expectations, and can be explained largely by the elimination of various price relief measures put in place last year. An increase in perceived sovereign risk and the upward pressures that this im¬plies on international financing costs and the exchange rate were further con¬siderations. Despite significant negative shocks, economic growth in the first half of the year (9.1%) is now expected to be significantly higher than projected in the April re¬port (7.1%), a sign of a more dynamic economy that could recover more quickly than previously forecast. Diverse economic activity figures have indicated high¬er-than-expected growth since the end of 2020. This suggests that the negative effects on output from recurring waves of COVID-19 have grown weaker and less long-lasting with subsequent outbreaks. Nevertheless, the third wave of the coro¬navirus, and to an even greater degree the previously mentioned roadblocks and disruptions to public order, likely led to a decline in GDP in the second quar¬ter compared to the first. Despite this, data from the monthly economic tracking indicator (ISE) for April and May surpassed expectations, and new sector-level measures of economic activity suggest that the negative impact of the pandemic on output continues to moderate, amid reduced restrictions on mobility and im¬provements in the pace of vaccination programs. Freight transportation registers (June) and unregulated energy demand (July), among other indicators, suggest a significant recovery following the roadblocks in May. Given the above, annual GDP growth in the second quarter is expected to have been around 17.3% (previously 15.8%), explained in large part by a low basis of comparison. The technical staff revised its growth projection for 2021 upward from 6% to 7.5%. This forecast, which comes with an unusually high degree of uncertain¬ty, assumes no additional disruptions to public order and that any new waves of COVID-19 will not have significant additional negative effects on economic activity. Recovery in international demand, price levels for some of Colombia’s export com¬modities, and remittances from workers abroad have all performed better than projected in the previous report. This dynamic is expected to continue to drive recovery in the national income over the rest of the year. Continued ample international liquidity, an acceleration in vacci¬nation programs, and low interest rates can also be ex¬pected to favor economic activity. Improved performance in the second quarter, which led to an upward growth revision for all components of spending, is expected to continue, with the economy returning to 2019 production levels at the end of 2021, earlier than estimated in the April report. This forecast continues to account for the short-term effects on aggregate demand of a tax reform package along the lines of what is currently being pro-posed by the national government. Given the above, the central forecast scenario in this report projects growth in 2021 of 7.5% and in 2022 of 3.1% (Graph 1.1). In this scenar¬io, economic activity would nonetheless remain below potential. The noted improvement in these projections comes with a high degree of uncertainty. Annual inflation increased more than expected in June (3.63%) as a result of changes in food prices, while growth in core inflation (1.87%) was similar to projections.

Macroeconomic summary Annual inflation continued to rise in the first quarter (8.5%) and again outpaced both market expectations and the technical staff’s projections. Inflation in major consumer price index (CPI) baskets has accelerated year-to-date, rising in March at an annual rate above 3%. Food prices (25.4%) continued to contribute most to rising inflation, mainly affected by a deterioration in external supply and rising costs of agricultural inputs. Increases in transportation prices and in some utility rates (energy and gas) can explain the acceleration in regulated items prices (8.3%). For its part, the increase in inflation excluding food and regulated items (4.5%) would be the result of shocks in supply and external costs that have been more persistent than expected, the effects of indexation, accumulated inflationary pressures from the exchange rate, and a faster-than-anticipated tightening of excess productive capacity. Within the basket excluding food and regulated items, external inflationary pressures have meaningfully impacted on goods prices (6.4%), which have been accelerating since the last quarter of 2021. Annual growth in services prices (3.8%) above the target rate is due primarily to food away from home (14.1%), which was affected by significant increases in food and utilities prices and by a rise in the legal monthly minimum wage. Housing rentals and other services prices also increased, though at rates below 3%. Forecast and expected inflation have increased and remain above the target rate, partly due to external pressures (prices and costs) that have been more persistent than projected in the January report (Graphs 1.1 and 1.2). Russia’s invasion of Ukraine accentuated inflationary pressures, particularly on international prices for certain agricultural goods and inputs, energy, and oil. The current inflation projection assumes international food prices will increase through the middle of this year, then remain high and relatively stable for the remainder of 2022. Recovery in the perishable food supply is forecast to be less dynamic than previously anticipated due to high agricultural input prices. Oil prices should begin to recede starting in the second half of the year, but from higher levels than those presented in the previous report. Given the above, higher forecast inflation could accentuate indexation effects and increase inflation expectations. The reversion of a rebate on value-added tax (VAT) applied to cleaning and hygiene products, alongside the end of Colombia’s COVID-19 health emergency, could increase the prices of those goods. The elimination of excess productive capacity on the forecast horizon, with an output gap close to zero and somewhat higher than projected in January, is another factor to consider. As a consequence, annual inflation is expected to remain at high levels through June. Inflation should then decline, though at a slower pace than projected in the previous report. The adjustment process of the monetary policy rate wouldcontribute to pushing inflation and its expectations toward the target on the forecast horizon. Year-end inflation for 2022 is expected to be around 7.1%, declining to 4.8% in 2023. Economic activity again outperformed expectations. The technical staff’s growth forecast for 2022 has been revised upward from 4.3% to 5% (Graph 1.3). Output increased more than expected in annual terms in the fourth quarter of 2021 (10.7%), driven by domestic demand that came primarily because of private consumption above pre-pandemic levels. Investment also registered a significant recovery without returning to 2019 levels and with mixed performance by component. The trade deficit increased, with significant growth in imports similar to that for exports. The economic tracking indicator (ISE) for January and February suggested that firstquarter output would be higher than previously expected and that the positive demand shock observed at the end of 2021 could be fading slower than anticipated. Imports in consumer goods, retail sales figures, real restaurant and hotel income, and credit card purchases suggest that household spending continues to be dynamic, with levels similar to those registered at the end of 2021. Project launch and housing starts figures and capital goods import data suggest that investment also continues to recover but would remain below pre-pandemic levels. Consumption growth is expected to decelerate over the year from high levels reached over the last two quarters. This would come amid tighter domestic and external financial conditions, the exhaustion of suppressed demand, and a deterioration of available household income due to increased inflation. Investment is expected to continue to recover, while the trade deficit should tighten alongside high oil and other export commodity prices. Given all of the above, first-quarter economic growth is now expected to be 7.2% (previously 5.2%) and 5.0% for 2022 as a whole (previously 4.3%). Output growth would continue to moderate in 2023 (2.9%, previously 3.1%), converging similar to long-term rates. The technical staff’s revised projections suggest that the output gap would remain at levels close to zero on the forecast horizon but be tighter than forecast in January (Graph 1.4). These estimates continue to be affected by significant uncertainty associated with geopolitical tensions, external financial conditions, Colombia’s electoral cycle, and the COVID-19 pandemic. External demand is now projected to grow at a slower pace than previously expected amid increased global inflationary pressures, high oil prices, and tighter international financial conditions than forecast in January. The Russian invasion of Ukraine and its inflationary effects on prices for oil and certain agricultural goods and inputs accentuated existing global inflationary pressures originating in supply restrictions and increased international costs. A decline in the supply of Russian oil, low inventory levels, and continued production limits on behalf of the Organization of Petroleum Exporting Countries and its allies (OPEC+) can explain increased projected oil prices for 2022 (USD 100.8/barrel, previously USD 75.3) and 2023 (USD 86.8/barrel, previously USD 71.2). The forecast trajectory for the U.S. Federal Reserve (Fed) interest rate has increased for this and next year to reflect higher real and expected inflation and positive performance in the labormarket and economic activity. The normalization of monetary policy in various developed and emerging market economies, more persistent supply and cost shocks, and outbreaks of COVID-19 in some Asian countries contributed to a reduction in the average growth outlook for Colombia’s trade partners for 2022 (2.8%, previously 3.3%) and 2023 (2.4%, previously 2.6%). In this context, the projected path for Colombia’s risk premium increased, partly due to increased geopolitical global tensions, less expansionary monetary policy in the United States, an increase in perceived risk for emerging markets, and domestic factors such as accumulated macroeconomic imbalances and political uncertainty. Given all the above, external financial conditions are tighter than projected in January report. External forecasts and their impact on Colombia’s macroeconomic scenario continue to be affected by considerable uncertainty, given the unpredictability of both the conflict between Russia and Ukraine and the pandemic. The current macroeconomic scenario, characterized by high real inflation levels, forecast and expected inflation above 3%, and an output gap close to zero, suggests an increased risk of inflation expectations becoming unanchored. This scenario offers very limited space for expansionary monetary policy. Domestic demand has been more dynamic than projected in the January report and excess productive capacity would have tightened more quickly than anticipated. Headline and core inflation rose above expectations, reflecting more persistent and important external shocks on supply and costs. The Russian invasion of Ukraine accentuated supply restrictions and pressures on international costs. This partly explains the increase in the inflation forecast trajectory to levels above the target in the next two years. Inflation expectations increased again and are above 3%. All of this increased the risk of inflation expectations becoming unanchored and could generate indexation effects that move inflation still further from the target rate. This macroeconomic context also implies reduced space for expansionary monetary policy. 1.2 Monetary policy decision Banco de la República’s board of directors (BDBR) continues to adjust its monetary policy. In its meetings both in March and April of 2022, it decided by majority to increase the monetary policy rate by 100 basis points, bringing it to 6.0% (Graph 1.5).