Performance pay and worker cooperation: Evidence from an artefactual field experiment

We report the results of an artefactual field experiment with bicycle messengers in Switzerland and the United States. Messenger work is individualized enough that firms can choose to condition pay on it, but significant externalities in messenger behavior nonetheless give their on-the-job interactions the character of a social dilemma. Second-mover behavior in our sequential prisoner's dilemma allows us to characterize the cooperativeness of our participants. Among messengers, we find that employees at firms that pay for performance are significantly less cooperative than those at firms that pay hourly wages or who are members of cooperatives. To examine whether the difference is the result of treatment or selection we exploit the fact that firm type is location-specific in Switzerland and that entering messengers must work in performance pay firms in the U.S.     

Social influence in technology adoption: taking stock and moving forward

Social influence has been shown to profoundly affect human behavior in general and technology adoption in particular. Over time, multiple definitions and measures of social influence have been introduced to the field of technology adoption research, contributing to an increasingly fragmented landscape of constructs that challenges the conceptual integrity of the field. Consequently, this paper sets out to review how social influence has been conceptualized in technology adoption research. In so doing, this paper attempts to inform researchers’ understanding of the construct, reconcile its myriad conceptualizations, constructively challenge extant approaches, and provide impulses for future research. A systematic review of the salient literature uncovers that extant interpretations of social influence are (1) predominantly compliance-based and as such risk overlooking identification- and internalization-based effects; (2) primarily targeted at the individual level and non-social technologies, thereby precluding the impact of socially enriched environments; and (3) heavily reliant on survey-based and US/China-centric samples, which jeopardizes the generalizability and predictive validity of the findings. Building upon these insights, this paper develops an integrated perspective on social influence in technology adoption research that encourages scholars to pursue a multi-theoretical understanding of social influence at the interface of users, social referents, and technology.     

Determinants of analysts’ revenue forecast accuracy

This study investigates financial analysts’ revenue forecasts and identifies determinants of the forecasts’ accuracy. We find that revenue forecast accuracy is determined by forecast and analyst characteristics similar to those of earnings forecast accuracy—namely, forecast horizon, days elapsed since the last forecast, analysts’ forecasting experience, forecast frequency, forecast portfolio, reputation, earnings forecast issuance, forecast boldness, and analysts’ prior performance in forecasting revenues and earnings. We develop a model that predicts the usefulness of revenue forecasts. Thereby, our study helps to ex ante identify more accurate revenue forecasts. Furthermore, we find that analysts concern themselves with their revenue forecasting performance. Analysts with poor revenue forecasting performance are more likely to stop forecasting revenues than analysts with better performance. Their decision is reasonable because revenue forecast accuracy affects analysts’ career prospects in terms of being promoted or terminated. Our study helps investors and academic researchers to understand determinants of revenue forecasts. This understanding is also beneficial for evaluating earnings forecasts because revenue forecasts reveal whether changes in earnings forecasts are due to anticipated changes in revenues or expenses.     

An Exploration of Frequent Service Failures in the Brazilian Airline Industry

This study explores how customer evaluations of service failures and failure recurrence impact negative emotions and intent to complain. A survey of 589 Brazilian airline passengers demonstrates the meditational effect of negative emotions such that customers who perceive failures as severe and/or preventable by the airline develop more negative emotions, which subsequently increases intent to complain. We also demonstrate the moderating role of failure recurrence such that failure recurrence reduces the effect of failure severity on negative emotions. Our findings have important implications for managers and airlines in order to mitigate negative outcomes following a service failure.     

Maximum entropy distributions inferred from option portfolios on an asset

We obtain the maximum entropy distribution for an asset from call and digital option prices. A rigorous mathematical proof of its existence and exponential form is given, which can also be applied to legitimise a formal derivation by Buchen and Kelly (J. Financ. Quant. Anal. 31:143–159, 1996). We give a simple and robust algorithm for our method and compare our results to theirs. We present numerical results which show that our approach implies very realistic volatility surfaces even when calibrating only to at-the-money options. Finally, we apply our approach to options on the S&P 500 index.     

Canonical valuation and hedging of index options

Canonical valuation is a nonparametric method for valuing derivatives proposed by M. Stutzer (1996). Although the properties of canonical estimates of option price and hedge ratio have been studied in simulation settings, applications of the methodology to traded derivative data are rare. This study explores the practical usefulness of canonical valuation using a large sample of index options. The basic unconstrained canonical estimator fails to outperform the traditional Black–Scholes model; however, a constrained canonical estimator that incorporates a small amount of conditioning information produces dramatic reductions in mean pricing errors. Similarly, the canonical approach generates hedge ratios that result in superior hedging effectiveness compared to Black–Scholes‐based deltas. The results encourage further exploration and application of the canonical approach to pricing and hedging derivatives. © 2007 Wiley Periodicals, Inc. Jnl Fut Mark 27: 771–790, 2007     

Long-Term Forecasts for Tourism Industries: the Case of Austria and Switzerland

This paper outlines the design of a causal econometric model for world tourism. The model allows for long-term forecasts of outgoing and incoming tourism for each country considered (here with a special emphasis on Austria and Switzerland) in a consistent international model setting. The main forecast result in the baseline scenario is that Austria gains market share in the long run, Switzerland loses significant market share. The growing tourism import demand resulting from the completion of the international European Community (EC)- market is widely allocated to the EC-member countries and the overseas destinations in the form of additional export growth. The non-EC member Austria loses market share. Switzerland would have even greater market share losses compared to the baseline scenario.