Is insurance normal or inferior? -A regret theoretical approach-

This study considers how changes in wealth affect insurance demand when individuals suffer disutility from regret. Anticipated regret stems from a comparison between the ex-post maximum and actual wealth. We consider a situation wherein individuals maximize their expected utility incorporating anticipated regret. The wealth effect on insurance demand can be classified into the risk and the regret effects. These effects are determined by the properties of the utility function and the regret function. We show that insurance can be normal when individuals place weight on anticipated regret, even though the utility function exhibit decreasing absolute risk aversion. This result indicates that regret theory is a possible explanation to the wealth effect puzzle, in which insurance is normal from empirical observation, but it should be inferior by theoretical prediction under expected utility theory.     

The Pazner-Schmeidler social ordering: A defense

It is shown that the Pazner-Schmeidler social ordering appears as a very natural solution to the problem of defining social preferences over distributions of divisible goods. The paper analyses various ways of deriving this social ordering from minimally egalitarian conditions and informational parsimony requirements.Received: 10 October 2003, Accepted: 4 April 2005, JEL Classification: D63, D71This paper was written while I was a research fellow at the ZiF (Bielefeld), for the project “Procedural Approaches to Conflict Resolution”, and the last version was prepared during my sabbatical year at Nuffield College, Oxford. I thank my hosts for their hospitality. D. Dimitrov and F. Maniquet have provided valuable comments on an earlier draft. I also thank the audience of a seminar at the U. of Montreal. Finally, the comments of three anonymous referees and the Associate Editor have been very helpful.     

Gentrification,Social Justice and Personal Ethics

Gentrification, leading to displacement, is an increasingly recognized social problem. Individuals who are confronted with tight housing possibilities but have adequate incomes confront personal ethical issues on whether to act in ways that may contribute to displacement of lower‐income residents, and researchers working on housing issues may be particularly concerned. In order to work out an ethical position, clarity is first needed on the differences among the various aspects of gentrification. The working definition used here is that gentrification includes the danger of displacement. A public policy response is thus required to deal with its social injustices. Specific steps are suggested for the development of such policy. Secondly, the suggestion is made that the individual choice of whether to move in or not is, importantly, a personal ethical choice and should take into account both the economic and political impact of the move itself but also the contribution that can be made through collective and political action by an in‐mover to deal with the injustices of gentrification. However, it is also an ethical choice for the professions involved and their associations.     

Picking the Measuring Stick: The Role of Leaders in Social Comparisons

Organizational members frequently evaluate how their abilities and standing compare with those of their colleagues. Although these comparisons can have a negative impact on organizations, little attention has been paid to the role of leaders in these processes. Drawing on interviews with individuals in leadership positions in business schools, we develop a framework to explain what triggers leaders’ attention to social comparisons among faculty and how they become involved in them. Central to this framework are leaders’ self‐schemas, which encompass their preferences about the criteria members should use in making comparisons. Leaders’ self‐schemas are activated by discrepancies between their own comparative judgements and those they perceive members to be making and impel them to act in ways consistent with their preferred bases of comparison. Our framework repositions social comparisons as a multi‐perspectival, political phenomenon in which leaders see themselves as playing a role in shaping members’ evaluations and workplace interactions.     

The relevance of personal characteristics in health care rationing: what the Australian public thinks and why

This article examines the preferences of the general public in Australia regarding health care resource allocation. While previous studies have revealed that the public is willing to give priority to particular groups of patients based on their personal characteristics, the present article goes beyond previous efforts in attempting to explain these results. In the present study, there was strong support among respondents for giving “equal priority” to people regardless of their personal characteristics. However, respondents did reveal a preference for married patients over single, for children over adults, for carers of children and the elderly, sole breadwinners, and good community contributors. Further, they would give a lower priority to those perceived as “self-harmers”—smokers, individuals with unhealthy diets, and those who rarely exercise. Variation in the answers according to broad economic and social beliefs across seven different categories (“factors”) influenced the pattern of the public's attitudes towards rationing. The Principal Components Analysis (PCA) indicated that most of the items in our survey are associated with seven factors that explain or capture much of the variation. These relate to a patient's avoidance of self-harm behaviors (Safe Living), their Life Style (diet, exercise, etc.), their contribution to the community through caring for others (Caring), their talents (Gifted), their sexual behavior (Sexuality), their age and marital status (Family), and whether they are an Australian citizen or employed (Citizen). The strength of social preferences—e.g., how strongly respondents would “discriminate” against a recreational drug user or preference a person with a healthy diet—is related to the particular class of preferences.     

Rational Irrationality and Group Size: The Effect of Biased Beliefs on Individual Contributions Towards Collective Goods

The price of irrationality or belief manipulation varies as we move from small to large group settings. Individual members of large groups can more cheaply bias downwards their beliefs as to the immorality of their free‐riding thereby circumventing internal moral constraints. The relative anonymity inherent to large number settings moreover reduces social pressures against free‐riding stemming from some common ethical or moral norms. Both selfish individuals facing an internal moral constraint to behave altruistically and those with altruistic preferences have an incentive to bias upward their belief of the decisiveness of their contribution in large number settings. In addition, the impact of symmetry and the illusion of control can introduce biases regarding the expected reactions of others to one's own decisions. The loosening of moral constraints will tend to increase free‐rider behavior while biased beliefs about the decisiveness of one's contribution or the reaction of others to one's actions will tend to decrease such behavior.     

On aggregation and welfare analysis

In this article, the beginnings of a new approach to the theory of aggregation are developed. The basic idea is that aggregation should involve two things: (a) data over which social preferences are defined should be mapped into a smaller-dimensional space, and (b) there should exist an ordering on that lower-dimensional space such that an improvement in this criterion implies an improvement for any of a class of social preference functions and of a class of individual preference relations defined over the original space. Results are developed which show that this conception of aggregation can yield meaningful results; particularly with respect to comparisons of ‘real national income’ in two situations, for a given economy.     

An artificial intelligence algorithmic approach to ethical decision-making in human resource management processes

Management scholars and practitioners have highlighted the importance of ethical dimensions in the selection of strategies. However, to date, there has been little effort aimed at theoretically understanding the ethical positions of individuals/organizations concerning human resource management (HRM) decision-making processes, the selection of specific ethical positions and strategies, or the post-decision accounting for those decisions. To this end, we present a Throughput model framework that describes individuals' decision-making processes in an algorithmic HRM context. The model depicts how perceptions, judgments, and the use of information affect strategy selection, identifying how diverse strategies may be supported by the employment of certain ethical decision-making algorithmic pathways. In focusing on concerns relating to the impact and acceptance of artificial intelligence (AI) integration in HRM, this research draws insights from multidisciplinary theoretical lenses, such as AI-augmented (HRM^(AI)) and HRM^(AI) assimilation processes, AI-mediated social exchange, and the judgment and choice literature. We highlight the use of algorithmic ethical positions in the adoption of AI for better HRM outcomes in terms of intelligibility and accountability of AI-generated HRM decision-making, which is often underexplored in existing research, and we propose their key role in HRM strategy selection.     

Do Individual Preferences Affect the Environmental Decision‐Making Process in Teams? The Role of Participation

Literature on organizations and the natural environment has focused on the importance of individual managers and leaders. However, this literature has scarcely ever focused on individuals in the team context, even when teams have been considered to be key for a firms’ environmental progress. Although teams’ environmental decisions can be enriched by the different contributions of team members, it is necessary that team members actually participate and contribute their preferences during the decision‐making process. We used an adaptation of the legislative dilemma task with 84 students to contribute to environmental management literature by analyzing members’ participation during the team decision‐making process. The results of this paper show how those members with environmentally proactive preferences have a higher participation during the decision‐making process, and as a consequence they have a greater influence on the team decision. Copyright © 2013 John Wiley & Sons, Ltd and ERP Environment.     

A comparative analysis of measures of social homogeneity

Social homogeneity refers to the degree to which the preferences of individuals in a society tend to be alike. A number of studies have been conducted to determine whether or not a relationship exists between various measures of social homogeneity and the probability that a Condorcet winner exists. In this study, it is shown that a strong general relationship of this type does not exist for measures of social homogeneity which account only for the proportions of individuals with various preference rankings. That is, for measures which account for these proportions but not for the preference rankings to which they are assigned. Profile specific measures of homogeneity do account for the preference rankings to which the proportions of voters are assigned. A much stronger relationship exists between profile specific measures of homogeneity and the probability that a Condorcet winner exists than for non-profile specific measures. In particular, Kendall's Coefficient of Condordance is shown to dominate twenty other measures of social homogeneity in terms of the strength of its relationship to the probability that a Condorcet winner exists.     

On the computability of quasi-transitive binary social choice rules in an infinite society and the halting problem

This paper investigates the computability problem of the existence of a vetoer and an oligarchy for quasi-transitive binary social choice rules (Mas-Colell and Sonnenschein in Rev Econ Stud 39:185–192, 1972) in a society with an infinite number of individuals (infinite society) according to the computable calculus (or computable analysis) by Aberth (Computable analysis, McGraw-Hill, New York, 1980; Computable calculus, Academic Press, Dublin, 2001). We will show the following results. The problem whether a quasi-transitive binary social choice rule which satisfies Pareto principle and independence of irrelevant alternatives (IIA) has a vetoer or has no vetoer in an infinite society is a nonsolvable problem, that is, there exists no ideal computer program for a quasi-transitive binary social choice rule which satisfies Pareto principle and IIA that decides whether it has a vetoer or has no vetoer. And it is equivalent to nonsolvability of the halting problem. We also show that if for any quasi-transitive binary social choice rule there exists an oligarchy in an infinite society, whether it is finite or infinite is a nonsolvable problem. A vetoer is an individual such that if he strictly prefers an alternative to another alternative, then the society prefers the former to the latter or is indifferent between them regardless of the preferences of other individuals, and an oligarchy is the minimal set of individuals which has dictatorial power and its each member is a vetoer. It will be shown that an oligarchy is a set of vetoers if it exists. This research was partially supported by the Ministry of Education, Science, Sports and Culture, Grant-in-Aid for Scientific Research (C), 20530165, and the Grant-in-Aid from the Zengin Foundation for Studies on Economics and Finance in Japan.     

Should We Require Every New Venture to Be a Hybrid Organization?

Critics of entrepreneurial capitalism have argued that entrepreneurship creates dysfunction in individuals, families, communities, and society because entrepreneurs neglect social and environmental dimensions of value in favour of financial value creation. By way of contrast, hybrid organizations, such as Benefit Corporations, are created explicitly to address social and environmental objectives in addition to their financial objective. Therefore, in this paper we explore the consequences of a world of blended value in which every new venture is required to be a hybrid organization. In doing so, we reveal the boundary conditions of current social criticism levied against entrepreneurship and suggest that blended value may best be relegated to the role of ideal or guideline as opposed to normative or legal obligation.     

CONTINUOUS PREFERENCE ORDERINGS REPRESENTABLE BY UTILITY FUNCTIONS

This paper surveys the conditions under which it is possible to represent a continuous preference ordering using utility functions. We start with a historical perspective on the notions of utility and preferences, continue by defining the mathematical concepts employed in this literature, and then list several key contributions to the topic of representability. These contributions concern both the preference orderings and the spaces where they are defined. For any continuous preference ordering, we show the need for separability and the sufficiency of connectedness and separability, or second countability, of the space where it is defined. We emphasize the need for separability by showing that in any nonseparable metric space, there are continuous preference orderings without utility representation. However, by reinforcing connectedness, we show that countably boundedness of the preference ordering is a necessary and sufficient condition for the existence of a (continuous) utility representation. Finally, we discuss the special case of strictly monotonic preferences.     

Measuring public opinion via digital footprints

Do digital traces accurately reflect individual preferences? Can signals from social media be used to measure public opinion? This paper provides evidence in favour of these hypotheses. We test a regression and post-stratification strategy that combines samples of digital traces with a stratification frame containing individual-level socio-economic data, in order to generate area forecasts of the outcome social phenomena of interest. In our example, we forecast the two-party vote of Democrats and Republicans in the 2018 Texas congressional district and Senate election. Our implementation assumes we can observe, and sample, individuals signaling their preference by favoring one virtual location over another; in our case, visiting Democrat versus Republican Facebook pages during the election campaign. Over the course of seven weeks preceding the mid-term elections we generate vote share forecasts which do not use any traditional survey data as input. Our results indicate that individuals leave digital traces that reflect their preferences.     

Counting Groves-Ledyard equilibria via degree theory

We study the Groves-Ledyard mechanism for determining optimal amounts of public goods in economies whose agents have the most general class of preferences for which a Pareto amount of public goods can be computed independently of income distribution. We use degree theory on affine spaces to show that the number of equilibria in such economies grows exponentially as the number of agents in the economy increases. The large number of equilibria in such simple economic models raises doubts as to whether the Groves-Ledyard mechanism is a workable solution to the Free Rider Problem since individuals may have incentives to falsify their preferences in order to drive the adjustment process to a preferred Nash equilibrium.     

The impact of relative residence times on the distribution of heavy drinkers in highly distinct environments

Alcohol consumption is a function of social dynamics, environmental contexts, individuals' preferences and family history. Empirical surveys have focused primarily on identification of risk factors for high-level drinking but have done little to clarify the underlying mechanisms at work. Also, there have been few attempts to apply nonlinear dynamics to the study of these mechanisms and processes at the population level. A simple framework where drinking is modeled as a socially contagious process in low- and high-risk connected environments is introduced. Individuals are classified as light, moderate (assumed mobile), and heavy drinkers. Moderate drinkers provide the link between both environments, that is, they are assumed to be the only individuals drinking in both settings. The focus here is on the effect of moderate drinkers, measured by the proportion of their time spent in “low-” versus “high-” risk drinking environments, on the distribution of drinkers.A simple model within our contact framework predicts that if the relative residence times of moderate drinkers are distributed randomly between low- and high-risk environments then the proportion of heavy drinkers is likely to be higher than expected. However, the full story even in a highly simplified setting is not so simple because “strong” local social mixing tends to increase high-risk drinking on its own. High levels of social interaction between light and moderate drinkers in low-risk environments can diminish the importance of the distribution of relative drinking times on the prevalence of heavy drinking.     

Do women followers prefer a different leadership style than men?

In an era that leadership is a key to organizational success, several researchers have tried to identify the ‘best style.’ This study aims to make a contribution toward this direction by examining followers' perceptions of the preferred leader profile from a gendered perspective. Evidence from 2008 individuals employed in the Greek public sector revealed that men and women do hold different views of how the ideal leader behaves. Furthermore, the need for achievement is responsible for greater variations in perceptions of the preferred leader profile, confirming the fact that men and women cannot be considered as uniform groups when examining leadership preferences.     

How Social Structures Influence the Labour Market Participation of Individuals with Mental Illness: A Bourdieusian Perspective

Adopting a Bourdieusian perspective, this paper examines the social structures that influence the labour market participation of individuals with mental illness. We draw on 257 qualitative surveys completed by individuals with diagnosed mental health conditions in Europe, North America, Oceania, Africa, and Asia. We employed thematic analysis to analyse the data. The findings reveal that the interplay of capital endowments, symbolic violence, habitus and illusio shape the labour market participation of individuals with mental illness. Capital endowments of individuals with mental illness are afforded less value in the labour market and these individuals internalize, legitimize and normalize their disadvantaged position, blaming themselves rather than questioning the social structures leading to the challenges they encounter. We highlight that social structures condition the opinion these individuals have of themselves and how this affects how they navigate the labour market. In sum, we show that Bourdieu's concepts provide a useful lens to study inequalities in the labour market, as they reveal the social structures that produce, sustain and reinforce the social order that disadvantages individuals with mental illness.     

Leveraging the employee voice: a multi-level social learning perspective of ethical leadership

Extending social learning theory to a multi-level perspective, this study proposes a theoretical model that investigates both individual and team-level mechanisms that mediate the effect of ethical leadership on employee voice. Specifically, in terms of an individual-level social learning perspective, we suggest that an ethical leader acts as a prototype of a moral person (i.e. an ethical role model). From a team-level social learning perspective, we propose that, as a moral manager, team ethical leadership will foster an ethical climate within the team which will create a moral context that impacts employees’ behaviors. In both instances, employee voice behaviors will be enhanced through these mechanisms. Evidencing the importance of the interaction between leader behaviors and context for leader effectiveness, we also show that employees are more likely to regard their ethical leaders as ethical role models in a team that highly values ethical conduct (i.e. high in ethical climate). Results obtained from 47 managers and 211 subordinates in China support our theoretical model. The theoretical and practical implications of our findings are also discussed.     

A collective labor supply model with complementarities in leisure: Identification and estimation by means of panel data

We present a novel identification strategy for a collective labor supply model that allows for complementarities in leisure (i.e., individuals may enjoy leisure more in company of their spouse). Individual preferences and the Pareto weights (which capture the intra-household bargaining process) are identified by making use of panel data with couples and individuals who became a widow(er) in the observation period, along with the assumption that an individual's preferences can only change in a particular manner after the spouse's death. The change in preferences comes from changes in observable variables that can be controlled for (like mental health) and from the loss of the possibility to jointly enjoy leisure after the couple's dissolution. We apply the model to American households coming from the first nine waves of the Health and Retirement Study (1992-2008) and show that complementarities in leisure are indeed important when modeling spouses' labor supply choices.