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Price Coherence and Adverse Intermediation

April 23, 2014 Comments off

Price Coherence and Adverse Intermediation
Source: Harvard Business School Working Papers (via SSRN)

Suppose an intermediary provides a benefit to buyers when they purchase from sellers using the intermediary’s technology. We develop a model to show that the intermediary will want to restrict sellers from charging buyers more for transactions it intermediates. We show that this restriction can reduce consumer surplus and welfare, sometimes to such an extent that the existence of the intermediary can be harmful. Specifically, lower consumer surplus and welfare result from inflated retail prices, over-investment in providing benefits to buyers, and excessive adoption of the intermediaries’ services. Competition among intermediaries intensifies these problems by increasing the magnitude of their effects and broadening the circumstances in which they arise. We show similar results arise when intermediaries provide matching benefits, namely recommendations of sellers to buy from. We discuss applications to travel reservation systems, payment card systems, marketplaces, rebate services, search engine advertising, and various types of brokers and agencies.

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Poverty and Crime: Evidence from Rainfall and Trade Shocks in India

April 21, 2014 Comments off

Poverty and Crime: Evidence from Rainfall and Trade Shocks in India
Source: Harvard Business School Working Papers

Does poverty lead to crime? We shed light on this question using two independent and exogenous shocks to household income in rural India: the dramatic reduction in import tariffs in the early 1990s and rainfall variations. We find that trade shocks, previously shown to raise relative poverty, also increased the incidence of violent crimes and property crimes. The relationship between trade shocks and crime is similar to the observed relationship between rainfall shocks and crime. Our results thus identify a causal effect of poverty on crime. They also lend credence to a large literature on the effects of weather shocks on crime and conflict, which has usually assumed that the income channel is the most relevant one.

Stepping Stone, Stopping Point, or Slippery Slope? Negotiating the Next Iran Deal

April 21, 2014 Comments off

Stepping Stone, Stopping Point, or Slippery Slope? Negotiating the Next Iran Deal
Source: Harvard Business School Working Papers

The November 2013 “interim” nuclear deal between Iran and the “P5 1” — the United States, Russia, China, Britain, France, and Germany — raises challenging questions. Will the initial deal function as a stepping stone toward a more comprehensive deal? Or will it drift into becoming a stopping point that leaves Iran dangerously close to nuclear weapons capability with the sanctions regime in decline? Or will it devolve to a slippery slope that would end up requiring a painful choice for key players between either acquiescing in a nuclear-capable Iran or attacking Iran’s nuclear facilities? With the Iran and the P5 1 each splintered into contending factions, a successful stepping stone strategy requires converting enough “persuadable skeptics” on each side to forge a “winning coalition” on behalf of the a more comprehensive nuclear deal. This supportive group must be strong enough to overcome the potent “blocking coalition” that will oppose virtually any larger, next-stage agreement. The best chance for the interim accord to become a stepping stone to a more valuable deal calls for a two-prong negotiating strategy with both value-enhancing and cost-imposing elements. The first prong of this strategy should strive to craft the most valuable possible next deal that credibly offers Iran a range of benefits, not limited to sanctions relief, that are greater and much more salient than those available from the interim agreement. The second prong should significantly worsen the consequences of failing to reach the next nuclear deal by a strong public U.S. Presidential commitment to sign a bill, prenegotiated with the Congress and P5 1 allies, imposing enhanced sanctions if negotiations toward an acceptable, but relatively narrow, agreement denying Iran an “exercisable nuclear option” do not succeed by the reasonable but firm deadline no later than twelve months from the start of the interim talks.

Facts and Figuring: An Experimental Investigation of Network Structure and Performance in Information and Solution Spaces

April 18, 2014 Comments off

Facts and Figuring: An Experimental Investigation of Network Structure and Performance in Information and Solution Spaces
Source: Harvard Business School Working Papers

Using data from a novel laboratory experiment on complex problem solving in which we varied the network structure of 16-person organizations, we investigate how an organization’s network structure shapes performance in problem-solving tasks. Problem solving, we argue, involves both search for information and search for solutions. Our results show that the effect of network structure is opposite for these two important and complementary forms of search. Dense clustering encourages members of a network to generate more diverse information but discourages them from generating diverse theories: in the language of March (1991), clustering promotes exploration in information space but decreases exploration in solution space. Previous research, generally focusing on only one of those two spaces at a time, has produced inconsistent conclusions about the value of network clustering. By adopting an experimental platform on which information was measured separately from solutions, we were able to reconcile past contradictions and clarify the effects of network clustering on problem-solving performance. The finding both provides a sharper tool for structuring organizations for knowledge work and reveals the challenges inherent in manipulating network structure to enhance performance, as the communication structure that helps one antecedent of successful problem solving may harm the other.

Managing Retirement Risks

April 18, 2014 Comments off

Managing Retirement Risks (PDF)
Source: American College of Financial Services

This table was built for the Retirement Income Certified Professional® (RICP®) designation program for financial advisors. Building a retirement income plan starts by making sure that the client’s income needs and other financial objectives are met. But after that is the tough task of evaluating all the risks that retirees face, and developing a plan to address each one. This table identifies 18 risks in six different categories. With each risk, we define the risk, provide an example, identify facts that describe the magnitude and scope of the risk, and offer a wide range of possible solutions.

The solutions offered here are intended to provide ideas. Building a retirement income plan is a complex process and building solutions to retirement risks is much more than just checking the box. For example, solving longevity risk may include deferring Social Security, purchasing annuities with lifetime payouts, buying life insurance to provide an income stream to a surviving spouse, and carefully choosing a withdrawal strategy from a retirement portfolio. In other words, almost every risk described here requires a carefully crafted, balanced set of solutions that requires thought, knowledge, and experience.

2013 Global Go To Think Tank Index Report

April 10, 2014 Comments off

2013 Global Go To Think Tank Index Report
Source: Think Tanks and Civil Societies Program (University of Pennsylvania)

The Think Tanks and Civil Societies Program (TTCSP) at the University of Pennsylvania released its seventh annual 2013 Global Go To Think Tanks Report on Wednesday January 22, 2014, at a morning press conference in Washington DC, hosted by the World Bank. The 2013 Global Go To Think Tank Index (GGTTI) marks the seventh year of continued efforts by the Think Tanks and Civil Societies Program at the University of Pennsylvania (TTCSP) to acknowledge the important contributions and emerging global trends of think tanks worldwide. Our initial effort to generate a ranking of the world’s leading think tanks in 2006 was a response to a series of requests from donors, government officials, journalists, and scholars, to produce regional and international rankings of the world’s preeminent think tanks. Since its inception, our ongoing objective for the GGTTI report is to gain understanding of the role think tanks play in governments and civil societies. Using this knowledge, we hope to assist in improving the capacity and performance of think tanks around the world.

Information and Incentives in Online Affiliate Marketing

April 10, 2014 Comments off

Information and Incentives in Online Affiliate Marketing (PDF)
Source: Harvard Business School Working Papers

We examine online affiliate marketing programs in which merchants oversee thousands of affiliates they have never met. Some merchants hire outside specialists to set and enforce policies for affiliates, while other merchants ask their ordinary marketing staff to perform these functions. For clear violations of applicable rules, we find that outside specialists are most effective at excluding the responsible affiliates, which we interpret as a benefit of specialization. However, in-house staff are more successful at identifying and excluding affiliates whose practices are viewed as “borderline” (albeit still contrary to merchants’ interests), foregoing the efficiencies of specialization in favor of the better incentives of a company’s staff. We consider the implications for marketing of online affiliate programs and for online marketing more generally.

Wind Power Can Be Cost-Comparable, New Analysis Reveals

April 3, 2014 Comments off

Wind Power Can Be Cost-Comparable, New Analysis Reveals
Source: Syracuse University School of Information Studies

The costs of using wind energy and natural gas for electricity are virtually equal when accounting for the full private and social costs of each, making wind a competitive energy source for the United States, according to a new study on the federal tax credit for wind energy.

Just released by researchers at Syracuse University and the University of California, the analysis shows that wind energy comes within .35 cents per kWh when levelized over the 20-year life of a typical wind contract, compared on an equivalent basis to the full costs for natural gas-fired energy, according to Jason Dedrick, associate professor at Syracuse University’s School of Information Studies (iSchool).

Innovative Mobility Carsharing Outlook: Carsharing Market Overview, Analysis, and Trends

April 2, 2014 Comments off

Innovative Mobility Carsharing Outlook: Carsharing Market Overview, Analysis, and Trends
Source: University of California-Berkeley (Transportation Sustainability Research Center)

North American Carsharing:
· As of January 1, 2013, there were 46 active programs in North America with 1,033,564 members sharing 15,603 vehicles.
· As of January 1,2013, 20 Canadian operators claimed 141,351 members and shared 3,432 vehicles. In the United States, 891,953 members shared 12,131 vehicles among 25 operators. In Mexico, 620 members shared 40 vehicles among one operator.
· Between January 2012 and January 2013, carsharing membership grew 24.1% in the United States and 53.4% in Canada. Between January 2012 and January 2013, carsharing fleets grew 23.6% in the United States and 35.9% in Canada.
· As of January 1, 2013, U.S. member-vehicle ratios were 73:1, representing a 0.4% increase between January 2012 and January 2013. In Canada, the ratio was 41:1, representing a 12.9% increase over the same period.

Worldwide Carsharing:
· As of October 2012, carsharing was operating in 27 countries and 5 continents, accounting for an estimated 1,788,000 members sharing over 43,550 vehicles.
· North America remains the largest carsharing region, with Europe and North America accounting for 38.7% and 50.8% of worldwide carsharing membership, respectively.
· Europe accounts for the majority of fleets deployed in 2012: 47.0% in contrast to 36.2% in North America.
· As of October 2012, one-way carsharing was operating in seven countries worldwide including (Austria, Canada, France, Germany, the Netherlands, the United Kingdom and the United States).

Personal Vehicle Sharing
· As of October 2012, there were 33 personal vehicle sharing operators worldwide, with 10 active or in pilot phase, three planned, and four defunct in North America.

NLRB Director for Region 13 issues Decision in Northwestern University Athletes Case

March 28, 2014 Comments off

NLRB Director for Region 13 issues Decision in Northwestern University Athletes Case</strong>
Source: National Labor Relations Board

Regional Director, Peter Sung Ohr, has issued a Decision in 13-RC-121359 finding the Grant-in-aid scholarship football players are employees under the NLRA and has directed an election to take place.

The parties have until April 9, 2014 to file with the Board in Washington, D.C. a Request for Review of the Decision.

Congressional Officials Grant Access Due To Campaign Contributions: A Randomized Field Experiment

March 28, 2014 Comments off

Congressional Officials Grant Access Due To Campaign Contributions: A Randomized Field Experiment (PDF)
Source: University of California-Berkeley

Concern that lawmakers grant preferential treatment to individuals because they have contributed to political campaigns has long occupied jurists, scholars, and the public. However, the effects of campaign contributions on legislators’ behavior have proven notoriously difficult to assess. We report the first randomized field experiment on the topic. In the experiment, a political organization attempted to schedule meetings between 191 Members of Congress and their constituents who had contributed to political campaigns. However, the organization randomly assigned whether it informed legislators’ offices that individuals who would attend the meetings were contributors. Congressional offices made considerably more senior officials available for meetings when offices were informed the attendees were donors, with senior officials attending such meetings more than three times as often (p < 0.01). Influential policymakers thus appear to make themselves much more accessible to individuals because they have contributed to campaigns, even in the absence of quid pro quo arrangements. These findings have significant implications for ongoing legal and legislative debates. The hypothesis that individuals can command greater attention from influential policymakers by contributing to campaigns has been among the most contested explanations for how financial resources translate into political power. The simple but revealing experiment presented here elevates this hypothesis from extensively contested to scientifically supported.

Have Inter-Judge Sentencing Disparities Increased in an Advisory Guidelines Regime? Evidence from Booker

March 27, 2014 Comments off

Have Inter-Judge Sentencing Disparities Increased in an Advisory Guidelines Regime? Evidence from Booker (PDF)
Source: University of Chicago School of Law

The Federal Sentencing Guidelines were promulgated in response to concerns of widespread disparities in sentencing. After almost two decades of determinate sentencing, the Guidelines were rendered advisory in United States v. Booker . What has been the result of reintroducing greater judicial discretion on inter-judge disparities, or differences in sentencing outcomes that are attributable to the mere happenstance of the sentencing judge assigned? This Article utilizes new data covering over 600,000 criminal defendants linked to sentencing judge to undertake the first national empirical analysis of inter-judge disparities post Booker .

The results are striking: inter-judge sentencing disparities have doubled since the Guidelines became advisory. Some of the recent increase in disparities can be attributed to differential sentencing behavior associated with judge demographic characteristics, with Democratic and female judges being more likely to exercise their enhanced discretion after Booker . Newer judges appointed after Booker also appear less anchored to the Guidelines than judges with experience sentencing under the mandatory Guidelines regime.

Disentangling the effect of various actors on sentencing disparities, I find that prosecutorial charging is a prominent source of disparities. Rather than charge mandatory minimums uniformly across eligible cases, prosecutors appear to selectively apply mandatory minimums in response to the identity of sentencing judge, potentially through superseding indictments. Drawing on this empirical evidence, the Article suggests that recent sentencing proposals that call for a reduction in judicial discretion in order to reduce disparities may overlook the substantial contribution of prosecutors.

Think Tank Review — Special Issue — EU-US Relations

March 27, 2014 Comments off

Think Tank Review — Special Issue — EU-US Relations
Source: European University Institute Library

On the occasion of the EU-US Summit we compiled the first Special Issue of the Think Tank Review, featuring publications on EU-US relations referenced in the Think Tank Reviews since its inception in late 2013. The collection has an obvious focus on the negotiations of the Transatlantic Trade and Investment Partnership (TTIP), however we also found analyses all other recent highlights in transatlantic relations, from security to finance.

100 Best Practices in Child Protection

March 25, 2014 Comments off

100 Best Practices in Child Protection (PDF)
Source: Johns Hopkins School of Advanced International Studies (The Protection Project) and International Centre for Missing & Exploited Children

Children are among our most vulnerable populations. The injustices many children suffer are unspeakable and occur in all corners of the globe, in all walks of life. The term “child protection” is very broad and can encompass a wide range of issues. Custody and support, child abuse and neglect, violence against children, child prostitution, child pornography, sex tourism, child labor, and trafficking in children are just some of the issues that arise when discussing child protection. Civil society organizations and government agencies are actively working around the world to address many of these problems and to better provide broad protections for children.

The Protection Project at The Johns Hopkins University School of Advanced International Studies and the International Centre for Missing and Exploited Children encourage the dissemination of information on child protection best practices. This guide is intended to offer examples of some successful initiatives undertaken by civil society organizations as well as individuals and government agencies concerned with protecting children around the world.

The document is divided into seven parts—Part I focuses on child protection principles and definitions; Part II highlights several child protection measures and services; Part III presents initiatives focused on the protection of children in the family and community; Part IV looks at programs aimed at the protection of children from sexual exploitation; Part V includes examples of projects focused on the protection of children from economic exploitation; Part VI looks at the protection of children in situations of emergency, including armed conflict; and Part VII features the protection of children in the justice system. This division of issues follows the topics addressed by the “Child Protection Model Law – Best Practices: Protection of Children from Neglect, Abuse, Maltreatment, and Exploitation” another publication based on a joint research inititative of The Protection Project and the International Centre for Missing and Exploited Children.

Arab Women Rising: 35 Entrepreneurs Making a Difference in the Arab World

March 24, 2014 Comments off

Arab Women Rising: 35 Entrepreneurs Making a Difference in the Arab World
Source: Knowledge@Wharton

Recent decades have seen greatly expanded opportunities for women throughout the Arab world, leveling the playing field as never before.

In Arab Women Rising, Knowledge@Wharton contributors Nafeesa Syeed and Rahilla Zafar share the entrepreneurial journeys of 35 women, from a flower farmer tending her fields in the Tunisian countryside to a Saudi royal advocating for expanded women’s rights throughout the kingdom.

This Knowledge@Wharton collection tells the stories of:

  • Pioneers who are establishing exciting technology companies in a region where mobile usage is on the upswing
  • Small and midsize business owners who started enterprises specializing in everything from public relations to the arts
  • Innovators who have rolled out new products, revamped fashions, and integrated new services into their industries
  • Visionaries tapping the big-picture potential the region holds in such growing fields as entertainment and science
  • Women effectively spearheading change in their communities by starting social enterprises

Inspiring and powerful, Arab Women Rising is a guide to understanding the modern business environment created and led by a new generation of women entrepreneurs in the Middle East and North Africa.

Speaking of Corporate Social Responsibility

March 24, 2014 Comments off

Speaking of Corporate Social Responsibility
Source: Harvard Business School Working Papers

We argue that the language spoken by corporate decision makers influences their firms’ social responsibility and sustainability practices. Linguists suggest that obligatory future-time-reference (FTR) in a language reduces the psychological importance of the future. Prior research has shown that speakers of strong FTR languages (such as English, French, and Spanish) exhibit less future-oriented behavior (Chen, 2013). Yet, research has not established how this mechanism may affect the future-oriented activities of corporations. We theorize that companies with strong-FTR languages as their official/working language would have less of a future orientation and so perform worse in future-oriented activities such as corporate social responsibility (CSR) compared to those in weak-FTR language environments. Examining thousands of global companies across 59 countries from 1999 to 2011, we find support for our theory and further that the negative association between FTR and CSR performance is weaker for firms that have greater exposure to diverse global languages as a result of (a) being headquartered in countries with a higher degree of globalization, (b) having a higher degree of internationalization, and (c) having a CEO with more international experience. Our results suggest that language use by corporations is a key cultural variable that is a strong predictor of CSR and sustainability.

EU — March 2014 Think Tank Review

March 24, 2014 Comments off

March 2014 Think Tank Review (PDF)
Source: European University Institute Library

Welcome to issue 11 of the Think Tank Review compiled by the EU Council Library. It references papers published in February 2014. As usual, we provide the link to the full text and a short abstract.

Time and again, developments on the ground in Ukraine catch the world off-guard. While the EU Council and – in this very days – EU Heads of State and Government keep Ukraine at the centre of their deliberations, and despite the risk of offering something obsolete, the TTR this month has a Special focus on Ukraine. A number of papers are (logically) a few weeks behind the times, but we kept those that offered background on, for example, the opposition movements in the country, its track record of integration with the EU, the energy policy implications of the crisis.

Predictably, an alysing the Ukrainian crisis led think tanks to direct some attention to EU – Russia relations, to the Eastern Partnership and indeed to the EU’s political engagement in Central Asia. Still in external relations, we highlight papers ranging from broad geopolitical notions (Eurasia) to micro analyses such as the one on Chinese investment in Greece. Readers interested in specific regions will find references to publications on Switzerland and Syria, the Arab countries and Afghanistan, the Asian Development Bank and the EU – Africa summit.

The papers on energy policy, energy security, nuclear and renewables resonate with climate and energy being on the agenda of the March European Council .

Return Migration and Geography of Innovation in MNEs: A Natural Experiment of On-the-Job Learning of Knowledge Production by Local Workers Reporting to Return Migrants

March 20, 2014 Comments off

Return Migration and Geography of Innovation in MNEs: A Natural Experiment of On-the-Job Learning of Knowledge Production by Local Workers Reporting to Return Migrants
Source: Harvard Business School Working Papers

I study whether return migrants and their direct reports facilitate knowledge production and transfer across borders for multinationals. Using unique personnel and patenting data for 1,315 inventors at an emerging market R&D center for a Fortune 50 technology firm, I exploit a natural experiment where the assignment of managers for newly hired college graduates is mandated by rigid HR rules and is uncorrelated to observable characteristics of the graduates. Given this assignment protocol, I find that local employees who report to return migrants file disproportionately more US patents. I also find evidence that return migration facilitates knowledge transfer across borders.

Are Top Executives Paid Enough? An Evidence-Based Review

March 19, 2014 Comments off

Are Top Executives Paid Enough? An Evidence-Based Review (PDF)
Source: Wharton School, University of Pennsylvania

Our review of the evidence found that the notion that higher pay leads to the selection of better executives is undermined by the prevalence of poor recruiting methods. Moreover, higher pay fails to promote better performance. Instead, it undermines the intrinsic motivation of executives, inhibits their learning, leads them to ignore other stakeholders, and discourages them from considering the long-term effects of their decisions on stakeholders. Relating incentive payments to executives’ actions in an effective manner is not possible. Incentives also encourage unethical behaviour. Organizations would benefit from using validated methods to hire top executives, reducing compensation, eliminating incentive plans, and strengthening stockholder governance related to the hiring and compensation of executives.

The Evolving Regulation of the Media in Europe as an Instrument for Freedom and Pluralism

March 19, 2014 Comments off

The Evolving Regulation of the Media in Europe as an Instrument for Freedom and Pluralism (PDF)
Source: European University Institute

European regulation of the media is influenced by the economic regulation of networks, contents, and e-commerce, to which it is very close. However, media regulation has one peculiar differentiating characteristic: it cannot concentrate only on market competition, as the rest of modern economic regulation does, but has to pursue other fundamental values. In particular, media pluralism and media freedom emerge as policy goals that are essential for democracy and human rights in Europe. In this paper, we discuss the EU’s search for a point of equilibrium in Member States’ resistance to the relinquishing of their power in the sector; we describe the current debate, and suggest some possible directions for development.

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