Platform strategies: how the position in the network drives success

Scholars have focused on platform strategies for a long time, moving from a product perspective to an industry-wide one. In particular, the decision to open the platform to external complementors has been studied through the perspective of platform leadership. The digital age is now moving from a closed approach versus an open approach. Is being a platform leader still imperative or is participating in a network of existing platforms still a suitable strategy as well? What kind of collaborations within an ecosystem leads to better performances? Leveraging social network analysis is performed within the network formed by mobile apps in the Health and Fitness category; this research shows how the decision of being (or not) a platform provider has an impact on the performances, but the position within the network mediates this impact. Based on the results obtained, research and managerial implications can be established.     

Making a play in the policy and politics arena: nursing and the national election

With health care surfacing in political campaigns across the country and referencing virtually every one of the policy topics discussed here, nurses have an important opportunity to share their views regarding both policy substance as well as engage in the political arena. For those nurses not yet ready to run for elective office, participating in grassroots efforts of campaigns, on advisory panels, and making financial contributions to preferred candidates are important opportunities not to be missed. Given the interest in and challenges ahead associated with health care broadly and nursing specifically, there is a great deal at stake.     

Non-myopic learning in differential information economies: the core

Summary. We study the process of learning in a differential information economy, with a continuum of states of nature that follow a Markov process. The economy extends over an infinite number of periods and we assume that the agents behave non-myopically, i.e., they discount the future. We adopt a new equilibrium concept, the non-myopic core. A realized agreement in each period generates information that changes the underlying structure in the economy. The results we obtain serve as an extension to the results in Koutsougeras and Yannelis (1999) in a setting where agents behave non-myopically. In particular, we examine the following two questions: 1) If we have a sequence of allocations that are in an approximate non-myopic core (we allow for bounded rationality), is it possible to find a subsequence that converges to a non-myopic core allocation in a limit full information economy? 2) Given a non-myopic core allocation in a limit full information economy can we find a sequence of approximate non-myopic core allocations that converges to that allocation? Received: May 25, 1999; revised version: August 9, 1999     

With and without the tracks: how railroad access impacts gas price elasticity

Since 2011, gas prices have fallen 43%, raising the question of how different communities adjust their vehicle miles travelled. Data from the National Household Travel Survey’s EPA fuel economy database and the Energy Information Administration database are used to measure consumers’ elasticity to changes in gas prices. We find no significant difference between the price elasticity of individuals in cities with rail access and those without. Furthermore, we are able to rule out an elasticity in those with rail that is greater than 0.61, suggesting that rail access does not make consumer demand elastic.     

Economic modeling using evolutionary algorithms: the effect of a binary encoding of strategies

We are concerned with evolutionary algorithms that are employed for economic modeling purposes. We focus in particular on evolutionary algorithms that use a binary encoding of strategies. These algorithms, commonly referred to as genetic algorithms, are popular in agent-based computational economics research. In many studies, however, there is no clear reason for the use of a binary encoding of strategies. We therefore examine to what extent the use of such an encoding may influence the results produced by an evolutionary algorithm. It turns out that the use of a binary encoding can have quite significant effects. Since these effects do not have a meaningful economic interpretation, they should be regarded as artifacts. Our findings indicate that in general the use of a binary encoding is undesirable. They also highlight the importance of employing evolutionary algorithms with a sensible economic interpretation.     

Taking action to close the nursing-finance gap: learning from success

Nurse leaders control the largest part of a hospital labor budget, in some cases the largest part of the overall budget. The effectiveness of overseeing this responsibility can mean the difference between an organization's financial stability and financial turmoil. The nursing department at Northwestern Memorial Hospital took ownership of its financial performance. Over the past 2 years, their financial performance saved $4.9 million in productivity while reducing nurses turnover costs by $7.6 million. Valuable lessons from their experience are offered for improving health care's financial and operational outlook.     

Trade frictions and welfare in the gravity model: how much of the iceberg melts?

Abstract.  A key element missing from the structural gravity literature is an examination of the implied general equilibrium. By design the gravity equation is adept at predicting bilateral trade flows. To make inferences beyond trade flows, however, the theoretic models should be consistent with other observables. Structural econometric estimates from Anderson and van Wincoop (2003) allow us to evaluate their proposed general equilibrium along several dimensions. We find that their gravity model predicts too large a difference between consumer and producer prices; excessive variation in the geographic distribution of consumer price indices; and an exceptionally large portion of output devoted to overcoming trade frictions. Under plausible parameterizations of the model at least 50% of output 'melts' in transit. JEL classification: F10     

Preference for flexibility in the absence of learning: the risk attitude effect

Individuals’ preferences over opportunity sets may display “preference for flexibility” which prescribes to gradually eliminate alternatives from a given set until a final choice is made. One rationale for this preference for flexibility is individuals’ incentive to postpone the final choice in order to better learn their underlying preferences over basic alternatives. In this paper we show that even in the absence of learning, preference for flexibility arises if individuals are risk-averse or, at least, are not very risk-seeking. Thus, individual’s attitude towards risk provides yet another rationale for preference for flexibility. One of our results is that in the absence of learning, risk-neutral as well as risk-averse individuals display the same, maximal preference for flexibility. We thank Han Bleichrodt, Robert Dur, Chaim Fershtman, Maarten Janssen, Peran van Reeven, Peter Wakker, and Timothy van Zandt for helpful comments to and inspiring discussions. We are very grateful to the anonymous referee for very constructive comments and suggestions.     

Greasing the wheels of international commerce: how services facilitate firms’ international sourcing

Abstract We use plant‐level data to study the link between the local availability of services and the decision of manufacturing firms to source materials from abroad. We develop a model to generate predictions about how the intensity of international sourcing of materials depends on the availability of services and firm characteristics. These predictions are supported by the data. Greater availability of services across regions, industries, and time increases firms’ foreign sourcing of materials relative to sales. The impact of services differs by firm type. National firms’ sourcing responds to changes in regional service conditions, whereas multinationals tend to be less affected.     

Removing export-credit subsidies to the Soviet bloc: Who gets hurt and by how much

Estimates of Soviet Bloc import elasticities and of the value of credit subsidies on loans to the bloc in 1981 are used in order to simulate the impact on OECD exports, if these subsidies had been eliminated in that year. The elasticity estimates indicate that price changes have little bearing on hard currency spent on a particular commodity by the Soviet Bloc. If subsidies had been eliminated in 1981, the total decline in OECD exports to the Bloc would have been less than 5%, and for any country, if proportionally distributed among suppliers, no more than 6%, no less than 2%.     

Investing against the wind: contagion during the recent financial crisis

This article examines the effect of Warren Buffett’s investment in Goldman Sachs on 24 September 2008, during the subprime mortgage crisis. Although this event is arguably perceived to be the biggest expression of confidence in the financial market during the crisis, by conducting event studies, we do not find the major counterparties of Goldman Sachs displayed positive abnormal returns. Moreover, the abnormal return is not significantly related to the counterparty connection. We have similar findings on these financial institutions’ default probabilities using credit default swap.     

Error cascades in observational learning: An experiment on the Chinos game

The paper reports an experimental study based on a variant of the popular Chinos game, which is used as a simple but paradigmatic instance of observational learning. There are three players, arranged in sequence,each of which wins a fixed price if she manages to guess the total number of coins lying in everybody?s hands. Our evidence shows that, despite the remarkable frequency of equilibrium outcomes, deviations from optimal play are also significant. And when such deviations occur, we find that, for any given player position, the probability of a mistake is increasing in the probability of a mistake of her predecessors. This is what we call an error cascade, which we measure by evaluating the (heterogeneous) Quantal Response Equilibrium which better suits our data. We also check the robustness of our findings when we allow for belief heterogeneity by applying Kübler and Weizsäcker?s (2004) cognitive frame of limited depth of reasoning.     

Playing safe in coordination games:: the roles of risk dominance, payoff dominance, and history of play

This paper presents results from a series of experiments designed to test the impact on subject behavior of changes in the risk dominance and payoff dominance characteristics of two player coordination games. The main finding is that changes in risk dominance significantly affect play of the subjects, whereas changes in the level of payoff dominance do not. Observed history of play also has an important influence on subject behavior, both when subjects are randomly rematched after each game and when they remain matched with the same individual for a sequence of games.     

Between X and Y: how process tracing contributes to opening the black box of causality

ABSTRACT

This article maps the methodological debate on process tracing and discusses the diverse variants of process tracing in order to highlight the commonalities beyond diversity and disagreements. Today most authors agree that process tracing is aimed at unpacking causal and temporal mechanisms. The article distinguishes two main types of use for process tracing. Some are more inductive, aimed at theory building (i.e. at uncovering and specifying causal mechanisms) while others are more deductive, aimed at theory testing (and refining). The paper summarizes the main added value and drawbacks of process tracing. It ends by providing ten guidelines for when and how to apply process tracing.     

Ambiguity aversion among student subjects: the role of probability interval and emotional parameters

In the literature on decision-making under uncertainty, it has been shown that decision-makers tend to prefer taking gambles with known-risk probabilities (pure risk) over equivalent gambles with ambiguous probabilities. This article contributes to the ongoing discussion in the literature on cognitive and non-cognitive covariates of ambiguity aversion. Through a series of experiments, it finds that subjects are more ambiguity-averse to prospects with wide probability intervals than to an equivalent prospect with narrow intervals, and that subjects’ inherent trust, happiness and level of optimism affect the level of ambiguity aversion.     

On the estimation and forecasting of international migration: how relevant is heterogeneity across countries?

This paper performs a comparative analysis of estimation as well as of out-of-sample forecasting results of more than 20 estimators common in the panel data literature using the data on migration to Germany from 18 source countries in the period 1967–2001. Our results suggest that the choice of an estimation procedure has a substantial impact on the parameter estimates of the migration function. Out-of-sample forecasting results indicate the following: (1) the standard fixed effects estimators clearly outperforms the pooled OLS estimator, (2) both the fixed effects estimators and the hierarchical Bayes estimator exhibit the superior forecast performance, (3) the fixed effects estimators outperform GMM and other instrumental variables estimators, (4) forecasting performance of heterogenous estimators is mediocre in our data set.     

On the power of indicators: how the choice of fuel poverty indicator affects the identification of the target population

In light of the creation of the EU Energy Poverty Observatory (EPOV) in January 2018 and the increase in debates on how fuel poverty is measured, we propose a critical analysis of fuel poverty indicators and demonstrate that choosing a given indicator is central to the identification of the fuel-poorpopulation.

First, we conducted an inter-indicator analysis to show how profiles of fuel-poor households vary depending on the indicator selected. We designed a multidimensional approach based on a multiple correspondence analysis and a hierarchical and partitioning clustering analysis to study characteristics of fuel-poor households. We highlight the difficulty of identifying a fuel-poor ‘typical profile’ and show that the composition of the population depends on the choice of the indicator.

Second, we applied an intra-indicator analysis using two objective expenditure-based indicators with thresholds. In particular, we conducted a sensitivity analysis based on a logit model including variables describing household and dwelling characteristics. We show that the profiles of fuel-poor households as well as the drivers of fuel poverty vary considerably with the chosen threshold level.Given these findings, we stress the need to review how we currently rely on conventional fuel poverty indicators to identify target groups and give some recommendations.