Business Commons^™

Contracts To Promote Optimal Use Of Optional Diagnostic Tests In Cancer Treatment, Salar Ghamat, Gregory S. Zaric, Hubert Pun

Business Publications

In this study, we examine performance-based payment contracts to promote the optimal use of an optional diagnostic test for newly diagnosed cancer patients. Our work is inspired by three trends: tremendous increases in the cost of new, advanced cancer drugs; development of new diagnostic tests to allow physicians to tailor treatment to patients; and changes in healthcare funding models that reward quality care. We model the interaction between two parties—a healthcare payer and an oncologist, in which the oncologist has private information about patients’ characteristics (adverse selection) and the payer does not know whether the oncologist takes the optimal course …

A Mechanism For Libor, Brian Coulter, Joel Shapiro, Peter Zimmerman

Business Publications

The investigations into LIBOR have highlighted that it is subject to manipulation. We examine a new method for constructing LIBOR that produces an unbiased estimator of the true rate. LIBOR itself is based solely on transactions. We allow for fines when a bank’s transaction is different than a comparison rate, which depends on the set of transactions and non-manipulated rates elicited by a revealed preference mechanism. These non-manipulated rates will always be used in the fines, but transactions may not. We address how this approach applies to other financial benchmarks and how it works even in markets in which there …

The Bull Of Wall Street: Experimental Analysis Of Testosterone And Asset Trading, Amos Nadler, Peiran Jiao, Cameron J. Johnson, Veronika Alexander, Paul J. Zak

Business Publications

Growing evidence shows that biological factors affect individual financial decisions that could be reflected in financial markets. Testosterone, a chemical messenger especially influential in male physiology, has been shown to affect economic decision making, and is taken as a performance enhancer among some financial professionals. This is the first experimental study to test how testosterone causally affects trading and prices. We exogenously elevated testosterone in male traders, and tested testosterone’s effect both on their trading behavior in experimental asset markets and on the size and duration of asset price bubbles. Using both aggregated and individual trading data, we find that …

Pollution And Politicians: The Effect Of Pm On Mps, Anthony Heyes, Nicholas Rivers, Brandon Schaufele

Business Publications

Applying methods of textual and stylometric analysis to all 119,225 speeches made in the Canadian House of Commons between 2006 and 2011, we establish that air pollution reduces the speech quality of Canadian Members of Parliament (MPs). Exposure to fine particulate matter concentrations exceeding 15 μg/m3 causes a 3.1 percent reduction in the quality of MPs speech (equivalent to a 3.6 months of education). For more difficult communication tasks the decrement in quality is equivalent to the loss of 6.5 months of schooling. Our design accounts for the potential endogeneity of exposure and controls for many potential confounders including individual …

New Vehicle Feebates, Nicholas Rivers, Brandon Schaufele

Business Publications

New vehicle feebate programs encourage improved fleet‐wide vehicle fuel efficiency; yet analyses of these policies have been limited to ad hoc proposals. In this paper, we exploit an extensive, multi‐year dataset which includes more than 16 million observations to evaluate the welfare implications of a long‐standing vehicle feebate program in the Canadian province of Ontario. We: (1) show that second‐best optimal feebates can be written as a function of new vehicle Pigouvian taxes; (2) find that Ontario's feebate program was welfare‐enhancing relative to a no feebate scenario but that a second‐best optimal benchmark would have yielded additional welfare while reducing …

Discrete Event Simulation Model For Planning Level 2 “Step-Down” Bed Needs Using Nems, Felipe F. Rodrigues, Gregory S. Zaric, David Stanford

Business Publications

In highly congested hospitals it may be common for patients to overstay at Intensive Care Units (ICU) due to blockages and imbalances in capacity. This is inadequate clinically, as patients occupy a service they no longer need; operationally, as it disrupts flow from upstream units; and financially as ICU beds are more expensive than ward beds. Step-down beds, also known as Level 2 beds, have become an increasingly popular and less expensive alternative to ICU beds to deal with this issue. We developed a discrete event simulation model that estimates Level 2 bed needs for a large university hospital. The …

“Integrated Reporting Is Like God: No One Has Met Him, But Everybody Talks About Him.” The Power Of Myths In The Adoption Of Management Innovations, Delphine Gibassier, Michelle Rodrigue, Diane-Laure Arjaliès

Business Publications

Purpose: This paper analyzes the process through which an IIRC (International Integrated Reporting Council) pilot company adopted “integrated reporting” (IR), a management innovation that merges financial and non-financial reporting.

Design/methodology/approach: We use a seven-year longitudinal ethnographic study based on semi-structured interviews, observations, and documentary evidence to analyze this multinational company’s IR adoption process from its decision to become an IIRC pilot organization to the publication of its first integrated report.

Findings: We demonstrate that the company envisioned IR as a “rational myth” (Hatchuel, 1998; Hatchuel and Weil, 1992). This conceptualization acted as a springboard for IR adoption, with the …

The Passion Of Luc Boltanski: The Destiny Of Love, Violence And Institution, Roger Friedland, Diane-Laure Arjaliès

Business Publications

On Justification: Economies of Worth (Boltanski and Thévenot, 1991/2006) was a synthetic and comprehensive parsing of common goods, goods that could and had to be justified in public. In response to Bourdieu’s critical sociology, they rather provided a robust and disciplined sociology of critique, the situated requirements of justification. They refused power and violence as integral to the operability of justification. They emphasized the ways in which conventions of worth afforded coordination, not their constitution of or by domination. They refused to make either capitalism, or the state, into primary motors of social order. Indeed, they refused social sphere, structure …

Bitcoin And The Rise Of Decentralized Autonomous Organizations, Ying-Ying Hsieh, Jean-Philippe Vergne

Business Publications

Bitcoin represents the first real-world implementation of a “decentralized autonomous organization” (DAO) and offers a new paradigm for organization design. Imagine working for a global business organization whose routine tasks are powered by a software protocol instead of being governed by managers and employees. Task assignments and rewards are randomized by the algorithm. Information is not channelled through a hierarchy but recorded transparently and securely on an immutable public ledger called “blockchain”. Further, the organization decides on design and strategy changes through a democratic voting process involving a previously unseen class of stakeholders called “miners”. Agreements need to be reached …