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Why Some Things Don't Get Discounted

A common question in managerial economics is why some products do not get discounted when perhaps they should.

In a lot of cases minimum prices are stipulated for retailers by manufacturers.

This would seem to create an antitrust issue, and historically it has. For about 100 years the legal system has viewed plain vanilla versions to be anti-competitive.

The manufacturers response to this has been to add a quid prod quo to the agreement - something like you can't lower the price because you benefit from advertising that we pay for. These are on shaky legal ground.

But last year the Supreme Court ruled that stipulating a minimum price was OK if the product potentially required personal support at the retailers (e.g., demos or technical expertise) that the manufacturer would like to encourage.

That's the backstory. Now here's some cute stuff for classroom use:

• Big box discounters and online retailers don't like it

"Opponents of the ruling, including eBay Inc. and Costco Wholesale Corp., are hoping the decision will be reversed by legislation expected to be debated in Congress next year. The bill's sponsor, Sen. Herb Kohl (D., Wis.), argues that minimum-pricing agreements violate the Sherman Act, the law that prohibits price fixing and bid rigging.

"However you want to dress up these policies with fancy legal language, these policies are obviously in the interest of business and not the consumer," says Jacob Weiss, founder of StopPriceFixing.org, a Web site that aims to end minimum pricing policies by educating consumers about them."

• But, traditional main streeters like them:

"Many traditional retailers favor minimum-pricing agreements because they help put a stop to what the stores view as unfair competition from online sellers, which can charge less because they have lower overhead costs."

• Students are often confused when they see products whose price is always the same everywhere:

"Mr. McMahon agrees consumers 'will think it odd when they go on the Internet and find all the products at exactly the same price.'"

• The manufacturers apparently know they are doing something that can be spun negatively without much effort.

"Manufacturers often don't like retailers to discuss their pricing agreements publicly. A 2008 MAP agreement from electronic learning-aids manufacturer LeapFrog Enterprises Inc. states, "This policy is considered confidential and should be respected as such relative to conversations with LeapFrog competitors.""

• Of course, you can't discriminate on the basis of a whole set of personal features, but you sure can over policies that might not be enforceable in court:

"Some manufacturers threaten to cut off supplies to retailers that charge below minimum prices outlined in agreements. One example is Alex Inc., in Northvale, N.J., which makes play houses and arts-and-crafts supplies, among other products."

Technorati Tags: managerial,economics,minimum,pricing,collusion

T-Rex = Chicken

New protein evidence confirms the suspicion that Tyrannosaurus Rex was more closely related to modern birds than to lizards or crocodilians (see here, non-gated versions are not yet available).

This soft tissue evidence should get everyone to stop saying the dinosaurs died out. They're still here - in fact, they're doing the nasty outside my office window as I write this.

This also explains how terror birds became the top predator immediately after the K-T extinction event that killed most of the dinosaurs - a few small theropods survived and grew in size to fill the niche left by the extinction of larger carnivorous dinosaur species.

P.S. A more precise dating of the K-T boundary came out this week too: 65.95 million years ago, plus or minus about 150,000 years.

Technorati Tags: dinosaur,tyrannosaurus,rex,chicken,ostrich,k-temperature,boundary,event,extinction

Book Review: Digging Dinosaurs

I recommend:

The subject matter may not interest everyone, but the writing is breezy and the text is not overly long. If you'd read a magazine article about dinosaur prospecting, then you'll have no trouble finishing this one.

The primary author, "Jack" Horner, is pretty well-known (he was a consultant to Steven Spielberg, and the paleontologist character of Alan Grant - played by Sam Neill in Jurassic Park films - is based on him). Horner is the man who proved that (at least some) dinosaurs cared for their young in nests like birds.

This book is the story of those digs in the late 70s and early 80s. How he and a friend happened across the bones of a baby dinosaur in a rock shop in Montana. Then how they went to the spot where the bones were found and dug up a lot more baby bones. This was followed by the realization that this was a nest filled with bones and trampled shells. The latter are important because they indicate that they babies stayed put for a while - and were fed by adults. Later came the realization that they were in a nesting ground - a huge area filled with many nests of first one, and then more species (as seen in the Disney movie Dinosaur).

Horner teamed with a journalist to write the book, so this is an easy and pleasant read.

Some Bayesian Updating from an Evolutionary Missing Link

The posterior probability that evolution is correct just got bumped up from the prior again (I know ... for some, that posterior hit 100% long ago).

The discovery of a new species of dinosaur was published today (FOXNews has the basics, but the complete Journal of Paleontology article is available online).

The dinosaur is a ceratopsian (triceratops is the best known of these frilled plant-eaters). 

Early fossils suggest that all ceratopsians had eyebrow horns. Later, a sub-family named the centrosaurians appeared in the record ... without brow horns.

James Kirkland pointed out that evolution suggests that an intermediary species with medium-sized browhorns will be found - a missing link. This specimen shows that this link is now filled.

The nice thing about a null hypothesis (like evolution) is that it allows you to delineate what should and should not occur if it is true.

In this case, Kirkland stuck his neck out a few years back to make a prediction based on the null hypothesis that could not be immediately confirmed. Anyone up on their statistics  knows that the longer the absence of confirmation persists, the more likely it is that the null should be rejected. This means that evolution was getting weaker until yesterday, and has had its strength reconfirmed today.

Anyone remember the last time the creationists and their fellow travelers volunteered to make a prediction that would make their position progressively weaker until ultimately confirmed? Just asking ...

Dinosaur Extinction

There is new and fairly solid evidence that the impact that killed the dinosaurs was a single event, and not a compound cataclysm spanning a three thousand centuries. Here is the abstract.

Gerta Keller, and others, have pushed the view over the last 10 years or so that there were 2 events that killed off the dinosaurs, separated by about 300,000 years. This view has been gaining popularity over the last decade, due to evidence of flourishing microfauna in the period immediately following the impact event. Speculation is that volcanic eruptions in India dealt the final blow in a one-two punch to dinosaurs.

This debate is largely one between paleontologists (like Keller), and geologists who  provided evidence of the impact.

The new evidence is particularly convincing because it comes from drilling cores taken from the Demerara Rise - an underwater plateau off the northwestern coast of Brazil (if your globe or atlas shows depth, it is easy to spot, even if unmarked, pointing eastwards from Surinam towards the mid-Atlantic).

The beauty of this result is that most of the debate has centered on geological locations that presumably were overwashed by tsunamis in the wake of the impact - so there is some uncertainty about the timing of the geological and fossil layering that is observed. It is believed that the surface over the Demerara Rise was shielded from these tsunamis by the curvature of the proto-South American continent (here is a view of the layout of the continents at the time of the impact). This means that it received only impact ejecta, without tsunami overwash, or vegetational burning.

The core discussed in the article is relatively pure, and suggests a single impact, with a steep decline in microfauna after the event.

How Much Power Did the Death Star Have?

Star Trek fans scoffed a bit when Star Wars came out.

Then the Death Star blew up a whole planet. That got geeks talking. Still does, apparently.

At the time, my older brother (more of a motorhead than a geek) even wondered how much power that would take.

Of course, someone figured out how much power the Death Star had. The answer is about 300,000,000,000,000,000,000,000,000,000,000 joules (yeah, joules ... remember high school science?).

Wikipedia can, of course, help us sort out how big that is. A kiloton of TNT has 4,000,000,000 joules of energy. The Hiroshima and Nagasaki bombs were about 14 kilotons. The impact that is believed to have eliminated the dinosaurs (and much of the rest of the life on the planet) is estimated to have released about 500,000,000,000,000,000,000,000 joules.

A little division shows that the Death Star had the power of 5,000,000,000,000,000,000,000 Hiroshima bombs, or 700,000,000 dinosaur killing impacts.

Yeah ... right ...

Instant Dinosaur Expertise

New Scientist has a webpage called Dinosaur: Instant Expert. Three pages of light prose with about 60 links to readily accessible articles published there over the years about what's new in dinosaur paleontology.

Oldest Tyrannosaurid Announced

This week's Nature announces Guanlong wucaii - the oldest member of the tyrannosaurid family. Here is the abstract and a news release (Nature iniitally embargoes electronic copies), and the takes from New Scientist and FoxNews - with an artist's rendering.

Tyrannosaurus rex was the largest and one of the last tyrannosaurids, living in the late Cretaceous period right up until the extinction of the dinosaurs 65 million years ago. (Yes, the Jurassic Park book and movie series took a little license).

This find pushes back the lineage of the tyrannosaurids from the early Cretaceous (130 million years ago) to the mid-Jurassic (160 million years ago). It also points to an Asian rather than a North American origin.

What is probably most interesting is that this find confirms the recent shift of tyrannosaurids from the carnosaur to the coelurosaur lineage. This is the line from which birds descend, and also that which contains the feathered carnivorous dinosaurs found over the last generation.

Dinosaurs are divided into two groups on the basis of hip structure: the ornithischians (non-long-necked plant eaters) and the saurischians. The latter subdivide into the sauropods (long-necked plant eaters) and the theropods (meat eaters). The latter subdivides again into carnosaurs and coelursaurs. The former are stocky and the latter are gracile. Until recently it was thought that tyrannosaurids were carnosaurs, but it now appears that this lineage peaked with Allosaurus 70 million years earlier. Interestingly the delicate bird-like bones of coelurosaurs allowed them to grow both larger and smaller than carnosaurs.

Further, this is also the group containing the raptors, which are believed to have been pack hunters; an idea that dovetails nicely with recent conjecture that tyrannosaurids hunted in family groups of swift youngsters with sturdier parents closing for the final kill.

Dinosaur Mummy

You read the title correctly - a mummy. Well, actually, a dinosaur that was naturally mummified before being fossilized.

And I've got the cool pictures!

A year ago today I went out to the dig (I waited a year because professional paleontologists like to keep the location of their digs secret to prevent vandalism). Their second season at that site is winding down, so I'm fairly confident they've got the good stuff out by now.

So I drove over the mountains just before the first storm of winter hit up top, 112 miles out into the Grand Staircase-Escalante National Monument. Off a four wheel drive road near a dry wash was the dig.

Dr. Alan Titus - the staff paleontologist for this national monument - made the intial discovery at the base of a hill. An unusual fossil, it had apparently eroded from further up the hill. There the majority of the fossilized animal was found in one location. The dig was being conducted by Mike Getty and his team from the Utah Museum of Natural History, where the cleanup work and ultimate display will be done.

The animal found is a Gryposaurus (this page shows the skull of a similar animal as well as a painting of what this animal looked like in life). This is a species of hadrosaur or duck-billed dinosaur. These were large (say, 30 feet long), common, herd-living plant eaters from the late Cretaceous (close to the end of the age of dinosaurs). It gets its name because of a distinctive nose hump which gives it something like a roman nose.

This particular find is unusual in several ways.

• The animal was naturally mummified. It died in an an exposed, arid region. It's body dessicated into a "bag of skin and bones" without being scavenged. After that, it was buried and fossilized.
• This specimen has positive skin impressions. Skin impressions from dinosaurs are very rare. And most of those are negative impressions - sand pushes up against the dead animal and turns to stone with an inverted impression of the skin (i.e., pits form in the sand if there are bumps on the skin). In this case, the positive skin impressions came from inside the dessicated "bag of skin and bones". The sand not only surrounded this bag, but infiltrated it so that the impressions were made from the inside of the hide.
• This specimen has fossilized tendons. Soft tissues don't fossilize well - thus most fossils are bones and teeth. There were many easily identifiable tendons in this specimen.
• This specimen contains a skull in good condition. A big difference between mammals and dinosaurs is that we have much more sophisticated teeth, jaws, and chewing capabilities. This makes our skulls much more robust. Dinosaur skulls are both more delicate (because they didn't need as many muscles to gulp their food as we do to chew it), and lighter (even for a large animal, holding your skull up in the air takes energy).
• This species is new to the area. Before the discovery of other hadrosaurs within the last few years in this monument, they were thought to be creatures which lived further north.

This find is also typical in certain ways.

• The type of dinosaur, a hadrosaur is not unusual - these were one of the two types of big plant-eating herd animals of the time (the horned ceratopsians are the other). 
• The amount of fossils found is also not unusual - it is great to get an animal that is this complete, but it isn't that rare any more.
  
• The location isn't unusual either - the Grand Staircase-Escalante National Monument is large, remote, and relatively unexplored by earlier paleontologists.
• The time period is also not unusual - the bones come from the late Cretaceous (about 75 million years ago) and this is fairly common period for dinosaur finds.

I arrived a tad late, and Titus was explaining the significance of this piece; so I didn't have a chance to ask as many questions about this piece as I liked. My understanding is that the significance of it is that it shows both a positive skin impression on one side of the rock and a negative on the other.

This is the outside of the same rock. Note the clear positive skin impressions as well as the obvious folding of the dessicated skin. Also of interest are the orange cylinders protruding from the rock - those are fossilized tendons.

Here is a small but extremely clear positive skin impression. Here is a small skin negative with a fossilized tendon - the skin is on the left, and I'm pointing at the tendon. Here is another negative of the skin with rib impressions where they pressed up against the skin from inside the "bag of skin and bones".

Here is the head still encased in rock. The back of the head is on the right, with the fragile attachments for the bill covered by plaster on the left. Note the boys sneaker at the bottom. The fossilized bone is orange, so the large circular areas of whiter rock within the bone are eye sockets and nasal cavities.

This is the entire block of stone they were trying to free that included the head. In this shot the back of the skull is on the left (the neck would have extended up and to the right) and snout is on the right. The nose hump that gives this dinosaur its name is in the bottom middle (covered with plaster because it is the primary means of identifying this species).

Here is a view of the head which I modified to increase the contrast - the general outline is now quite sharp. The head fills most of this picture, with the back of the skull on the right, the bill on the left, and the lower jaw and roman nose clearly visible.

Here is a pile of assorted ribs. The spine and leg bones were nearby (but out of the picture).

You saw it here first, so look for this find on a documentary in the next few years.

Basal Therizinosaur Discovered

The discovery of the earliest known therizinosaur - called Falcarius - was announced in today's issue of Nature.

Therizinosaurs are highly unusual dinosaurs that were previously thought to have originated in Asia.

Dinosaurs are divided into two big groups based on their hip structure. One of those groups is further divided into four-legged sauropods (long-necked plant eaters) and two-legged theropods. The latter group includes all meat-eating dinosaurs, such as Tyrannosaurs and Velociraptors. Theropods were also frequently feathered, and are thought to be the ancestors of birds.

Therizinosaurs are so unusual because they appear to be theropods that evolved away from eating meat to eating plants. They have smaller, duller teeth than other theropods, and often have preposterously long claws.

The find announced today was based on a nearly complete skeleton, showing a 12 foot long, 4 foot tall, two-legged, apparently feathered creature, with very long claws. (This article contains a photo of a reconstructed skeleton, while this article shows two different artists' renderings).

The find of multiple skeletons from amidst thousands of bones was made northwest of Moab, Utah.

P.S. About a year ago I posted about the discovery of a therizinosaur closer to my home. That skeleton was found in rocks laid 60 miles out in the Cretaceous seas. I speculated - based on its enormous claws - that it may have been a digger of crustaceans on long vanished sandbars. I was told that unpublished evidence suggests similarities between the teeth of therizinosaurs and those of contemporary crab-eating seals.

P.P.S. It's a big day for dinosaurs. Science is reporting today the first confirmation of unlaid eggs inside a fossilized female dinosaur. The find suggests that dinosaurs reproductive system was somewhere between that of crocodiles and birds.