Behavioral Economics Commons^™

Precarious Paradise: The Financial Well-Being Of Hispanic Immigrant Day Laborers In Malibu, Luisa Blanco, Lila M. Carlsen, Daniel R. Morrison, George Carlsen, Ashley Chaparro, Erick Molina

Lila McDowell Carlsen

Decision-Making In Simultaneous Games: Reviewing The Past For The Future, Mohsen Ahmadian, Ehsan Elahi, Roger Blake

Mohsen Ahmadian

Inattention To Deferred Increases In Tax Bases: How Michigan Homebuyers Are Paying For Assessment Limits, Sebastien J. Bradley

Sebastien J Bradley

Ancillary Revenue And Price Fairness: An Exploratory Study Pre & Post Flight, Blaise P. Waguespack, Tamilla Curtis

Dr. Tamilla Curtis

The growing impact of Ancillary Revenue on consumer choice and shopping behavior continues to be a highly debated issue. In the US, the Department of Transportation (DOT) has stepped into the debate and is investigating the possibility of new rules on how airlines must report and display such ancillary offerings. While the DOT collects data, reports on the amount of ancillary revenue earned by the airlines continue to rise. Examining past research on price fairness from the marketing literature and the impact of revenue management on price fairness from the aviation literature, this article joins new research appearing on the …

Cynicism In Negotiation: When Communication Increases Buyers’ Skepticism, Eyal Ert, Stephanie J. Creary, Max H. Bazerman

Stephanie J. Creary

The economic literature on negotiation shows that strategic concerns can be a barrier to agreement, even when the buyer values the good more than the seller. Yet behavioral research demonstrates that human interaction can overcome these strategic concerns through communication. We show that there is also a downside of this human interaction: cynicism. Across two studies we focus on a seller-buyer interaction in which the buyer has uncertain knowledge about the goods for sale, but has a positive expected payoff from saying “yes” to the available transaction. Study 1 shows that most buyers accept offers made by computers, but that …

The Existence And Perception Of Redundancy In Consumer Information Environments, Michael D. Johnson, Jerome M. Katrichis

Michael D. Johnson

Two studies are reported which examine the existence of attribute redundancy as well as consumers' ability to perceive attribute redundancy in consumer information environments. The results of the first study suggest that attribute redundancy varies widely from product category to product category. The results of the second study suggest that consumers' ability to perceive attribute relationships improves with product knowledge. Unexpected was an observed U-shaped relationship between consumers' perceptions of attribute redundancy and attribute knowledge. Together the results suggest a number of policy implications regarding the value of consumer information programs.

The Effects Of Fatigue On Judgments Of Interproduct Similarity, Michael D. Johnson, Donald R. Lehmann, David A. Horne

Michael D. Johnson

Similarity scaling often requires subjects to produce such a large number of judgments that fatigue may become a problem. Yet it remains unclear just how respondent fatigue affects similarity perceptions and resulting judgments. The present study uses a categorization perspective to examine the effects of fatigue on similarity judgments. The results suggest that subjects rely increasingly on category membership as they progress through a similarity judgment task.

Attribute Abstraction, Feature-Dimensionality, And The Scaling Of Product Similarities, Michael D. Johnson, Donald R. Lehmann, Claes Fornell, David A. Horne

Michael D. Johnson

This paper examines the attributes that consumers use when making product similarity judgments and their effect on similarity scaling. Previous research suggests that concrete brands are judged using dichotomous features while more abstract product categories are judged using continuous dimensions. This, in turn, suggests that the appropriateness of spatial scaling increases relative to tree scaling as one moves from brands to product categories. The results of two studies support an increase in the fit of spaces relative to trees from brands to categories. However, the abstractness of the judgments appears to be driving the effect, not the use of features …

“The Influence Mix” – Information Access In The New Age And Empowerment Of Consumers ¿Decline Or Reformulation In Branding Development?, Alejandro Castro

Alejandro Castro

The new technological age is changing the rules in marketing. Now consumers are influenced by other sources of information and brands might be losing the battle. Itamar Simonson and Emanuel Rosen state in their book “Absolute Value” that consumers now base their decisions on reviews from other users, opinions and other emerging technologies that are turning choices more rational. Therefore traditional sources of information controlled by marketing are fading. In this article we focus on Brands and we answer the following question ¿Are we before a declining on branding or are we force to implement new marketing strategies for branding …

Customer Satisfaction, Loyalty And Repurchase: Some Evidence From Apparel Consumers, Tamilla Curtis, Russell Abratt, Paul Dion, Dawna L. Rhoades

Dr. Tamilla Curtis

While customer satisfaction, loyalty and repurchase intent are some of the most researched areas in marketing and consumer behavior, there is little certainty on the direction and strength of these relationships. After completing a literature review, this study develops a model of loyalty dimensions, satisfaction and repurchase intent. A sample of 499 respondents who had purchased jeans was interviewed in the Southeastern United States. Results were analyzed using Structural Equation Modeling. The results of nine hypothesized relationships are discussed. A significant positive relationship exists between commitment and repurchase/repurchase intent. Some surprising findings also emerged as the model was modified. It …

Effects Of Global Competitiveness, Human Development, And Corruption On Inward Foreign Direct Investment, Tamilla Curtis, Dawna L. Rhoades, Tom Griffin

Dr. Tamilla Curtis

The purpose of this paper is to investigate which of Dunning's location-specific advantages of host countries, presented as composite indices for Global Competitiveness, Human Development and Corruption Perception, better predict the level of inward Foreign Direct Investment (FDI). A stepwise multiple regression method was applied on a sample of 129 countries, which was further divided into two subgroups: OECD members and non-OECD members. The study provides evidence that global competitiveness and the level of corruption of the host country are important determinants for inward FDI. For non-OECD countries the Human Development index appears to be an additional FDI determinant. More …

Malaysian Tax System And Individual Tax Knowledge, Noraza Mat Udin

NORAZA MAT UDIN

No abstract provided.

Teleinvestmentevangelists: Celebrity, Ritual And Religion And The Quest To “Beat The Market”, E. Douglas, Mary Keller, Elton Mcgoun

Mary L Keller

Purpose – This paper aims to offer a cultural understanding of investor faith in stock picking despite overwhelming evidence questioning its efficacy. Why, in the face of very widely communicated findings calling into question the advice and assistance offered by financial professionals to help them pick stocks or manage their mutual funds, do so many people persist in these practices? The authors believe that the best way to understand investor faith in the efficacy of stock picking is through teleinvestmentevangelists such as Jim Cramer, whose fusion of celebrity and religion taps into the ritualistic elements of investment that usually lie …

Pay-What-You-Want Pricing: Can It Be Profitable?, Yong Chao, Jose Fernandez, Babu Nahata

Yong Chao

Using a game theoretic framework, we show that not only can pay-what-you-want (PWYW) pricing generate positive profits, but it can also be more profitable than charging a fixed price to all consumers. Further, whenever it is more profitable, it is also Pareto-improving. We derive conditions in terms of two parameters, namely the marginal cost of production and the psychological cost of the consumer for paying too little compared to her reference price.

The paper makes the following contributions to the existing literature. First, we endogenize the choice of pricing strategies—PWYW vs. fixed price. Thus rather than solely focusing on the …

Huge Growth Potential In 2015 For Used Books Market - A Surney, Lissa Coffey

LissaCoffey

Selling Buying Used Books - A Market With Huge Potential in 2015 - Selling/buying books online is a great way to earn extra income and an upcoming market having huge growth potential in 2015. Size the US market for used books ... Conduct research on used book selling and buying activities. The starting point for their analysis is the double-edged impact of a used book market ... But there's another effect: the presence of a market for used books ... "The growth reflects how easy is has become to sell used books.The used book market for college textbooks has been …

Esochoice: The Self-Manipulation Of Tastes By Chameleonic Decision Makers, Brian J. Gibbs

Brian J. Gibbs

No abstract provided.

The Relation Between Variance And Information Rents In Auctions, Brett Katzman, Julian Reif, Jesse Schwartz

Jesse A. Schwartz

This paper examines the conventional wisdom, expressed in McAfee and McMillan's (1987) widely cited survey paper on auctions, that links increased variance of bidder values to increased information rent. We find that although the conventional wisdom does indeed hold in their (1986) model of a linear contract auction, this relationship is an artifact of that particular model and cannot be generalized. Using Samuelson's (1987) model, which is similar but allows for unobservable costs, we show that increased variance does not always imply increased information rent. Finally, we give the appropriate measure of dispersion (different from variance) that provides the link …

Collusive Bidding In The Fcc Spectrum Auctions, Peter Cramton, Jesse Schwartz

Jesse A. Schwartz

This paper describes the bid signaling that occurred in many of the FCC spectrum auctions. Bidders in these auctions bid on numerous spectrum licenses simultaneously, with bidding remaining open on all licenses until no bidder is willing to raise the bid on any license. Simultaneous open bidding allows bidders to send messages to their rivals, telling them on which licenses to bid and which to avoid. This “code bidding” occurs when one bidder tags the last few digits of its bid with the market number of a related license. We examine how extensively bidders signaled each other with retaliating bids …

Voice Without Say: Why Capital-Managed Firms Aren’T (Genuinely) Participatory, Justin Schwartz

Justin Schwartz

Why are most capitalist enterprises of any size organized as authoritarian bureaucracies rather than incorporating genuine employee participation that would give the workers real authority? Even firms with employee participation programs leave virtually all decision-making power in the hands of management. The standard answer is that hierarchy is more economically efficient than any sort of genuine participation, so that participatory firms would be less productive and lose out to more traditional competitors. This answer is indefensible. After surveying the history, legal status, and varieties of employee participation, I examine and reject as question-begging the argument that the rarity of genuine …

Property Tax Salience And Payment Delinquency, Sebastien J. Bradley

Sebastien J Bradley

Despite only modest supporting evidence, shocks to households' personal finances are commonly cited as one of the principal causes of homeowner defaults. In this paper, I investigate the extent to which different component sources of annual variation in property tax obligations influence the probability and magnitude of property tax delinquency|a precursor to mortgage default. Under Michigan's system of property tax limitations, rational homeowners should readily anticipate changes in tax liability, making such changes an unlikely cause of delinquency, regardless of the underlying source. Looking at tax payment records for the city of Ann Arbor, Michigan for the period 2006-2009, I …

The Stability Of Offshore Outsourcing Relationships: The Role Of Relation Specificity And Client Control, Stephan Manning, Arie Y. Lewin, Marc Schuerch

Stephan Manning

Offshore outsourcing of administrative and technical services has become a mainstream business practice. Increasing commoditization of business services and growing client experience with outsourcing have created a range of competitive service delivery options for client firms. Yet, data from the Offshoring Research Network (ORN) suggests that, despite increasing market options and growing client quality and cost efficiency expectations, clients typically renew provider contracts and develop longer-term relationships with providers. Based on ORN data, this paper explores drivers of this phenomenon. The findings suggest that providers promote contract renewal by making client specific investments in software, IT infrastructure and training, and …

Not-So-Strong Evidence For Gender Differences In Risk, Julie Nelson

Julie A. Nelson

In their article "Strong Evidence for Gender Differences in Risk Taking," Gary Charness and Uri Gneezy (2012) review a number of experimental studies regarding investments in risky assets, and claim that these yield strong evidence that females are more risk averse than males. This study replicates and extends their article, demonstrating that its methods are highly problematic. While the methods used would be appropriate for categorical, individual-­‐level differences, the data reviewed are not consistent with such a model. Instead, modest differences (at most) exist only at aggregate levels, such as group means. The evidence in favor of gender difference is …

Wat Is Coöperatief Ondernemen?, Lieve Jacobs, Wim Van Opstal

Wim Van Opstal

De discussie van wat een echte coöperatie is en hoort te zijn, is haast zo oud als de coöperatieve beweging zelf en lijkt soms wel op de zoektocht naar de heilige graal. Toch beschikt de internationale coöperatieve beweging, vertegenwoordigd door de Internationale Coöperatieve Alliantie (ICA), over een referentiekader met een gemeenschappelijke definitie, principes en waarden. Dit referentiekader is zelf het compromis tussen vele verschillende visies en stromingen binnen het coöperatieve denken. Net daarom is het verstandig om dit eerder als een kompas in plaats van als een keurslijf te beschouwen. In deze bijdrage illustreren we de praktische grondslagen en gevolgen …

Coöperaties In België. Top 100 Van De Grootste Belgische Coöperatieve Vennootschappen In 2011, Wim Van Opstal

Wim Van Opstal

In deze publicatie presenteren we de top 100 van de grootste Belgische coöperatieve vennootschappen in 2011. We bespreken de grootste coöperaties volgens hun economische activiteit en geven zo een venster op de rijke diversiteit aan coöperatieve initiatieven in ons land.

Pay-What-You-Want Pricing And Competition: Breaking The Bertand Trap, Yong Chao, Jose Fernandez, Babu Nahata

Yong Chao

Pay-What-You-Want (PWYW) pricing is a recent participative pricing strategy where a seller offers a good or service for any price consumers want to pay, including zero or some minimum payment. This paper provides a theoretical framework to study strategic effects of the PWYW pricing under duopoly by incorporating behavioral considerations of consumers in making voluntary payments when they could be freeloaders. Without identifying any particular behavioral factor, we assume that consumers feel a sense of guilt when they pay less than their reference points. It is shown that the PWYW pricing can be a profitable marketing strategy than the conventional …

The Power Of Stereotyping And Confirmation Bias To Overwhelm Accurate Assessment: The Case Of Economics, Gender, And Risk Aversion, Julie A. Nelson

Julie A. Nelson

Behavioral research has revealed how normal human cognitive processes can tend to lead us astray. But do these affect economic researchers, ourselves? This article explores the consequences of stereotyping and confirmation bias using a sample of published articles from the economics literature on gender and risk aversion. The results demonstrate that the supposedly “robust” claim that “women are more risk averse than men” is far less empirically supported than has been claimed. The questions of how these cognitive biases arise and why they have such power are discussed, and methodological practices that may help to attenuate these biases are outlined.

Poisoning The Well, Or How Economic Theory Damages, Julie A. Nelson

Julie A. Nelson

Contemporary mainstream economics has widely “poisoned the well” from which people get their ideas about the relationship between economics and ethics. The image of economic life as inherently characterized by self-interest, utility- and profitmaximization, and mechanical controllability has caused many businesspeople, judges, sociologists, philosophers, policymakers, critics of economics, and the public at large to come to tolerate greed and opportunism, or even to expect or encourage them. This essay raises and discusses a number of counterarguments that might be made to the charge that current dominant professional practice is having negative ethical effects, as well as discussing some examples of …

Coöperaties In België. Profielschets 2005-2010, Wim Van Opstal

Wim Van Opstal

Coöperaties kennen de jongste jaren een groeiende aandacht binnen de academische wereld, het bedrijfsleven, het maatschappelijke middenveld en het beleid. Coöperaties worden tijdens een groeiend aantal studiedagen gewikt en gewogen als mogelijk instrument voor diverse uitdagingen die we vandaag kennen op economisch, sociaal en ecologisch vlak. Cijfers over coöperaties in ons land zijn echter schaars. In deze publicatie presenteren we een profielschets van de coöperatieve vennootschappen in België met daarin enkele kerngegevens die de lezer wegwijs maken in het Belgische coöperatieve landschap. We bestrijken daarmee de periode 2005-2010 en baseren ons hiervoor op administratieve gegevens, afkomstig uit de Balanscentrale van …

Les Co-Opératives En Belgique. Profil 2005-2010, Wim Van Opstal

Wim Van Opstal

Cette publication présente le profil des sociétés coopératives en Belgique, principaux chiffres à la clef, afin de faire découvrir au lecteur le paysage coopératif en Belgique. La période concernée est 2005-2010 et nous nous basons sur les données fournies par la Centrale des bilans de la Banque Nationale de Belgique (BNB), la Banque- Carrefour des entreprises (BCE) et l’Office National de Sécurité Sociale (ONSS). Grâce à la collaboration du Département Emploi et Economie Sociale du gouvernement flamand, ces données ont pu être obtenues auprès de la cellule de coordination Vlaams e-Government (CORVE), qui rassemble les données dans la Verrijkte Kruispuntbank …

El Individuo Y La Comunidad. Aeon J. Skoble, Mario Šilar

Mario Šilar

No abstract provided.