Rational Choice in Strategic Environments: Further Observations

This note clarifies some aspects of Bernheim's (1986) characterization of Nash and correlated equilibria.     

Auctions and information acquisition: sealed bid or dynamic formats?

The value of an asset is generally not known a priori, and it requires costly investments to be discovered. In such contexts with endogenous information acquisition, which selling procedure generates more revenues? We show that dynamic formats, such as ascending‐price or multistage auctions, perform better than their static counterpart. This is because dynamic formats allow bidders to observe the number of competitors left throughout the selling procedure. Thus, even if competition appears strong ex ante, it may turn out to be weak along the dynamic format, thereby making the option to acquire information valuable. This very possibility also induces the bidders to stay longer in the auction, just to learn about the state of competition. Both effects boost revenues, and our analysis provides a rationale for using dynamic formats rather than sealed‐bid ones.     

The Action Logics of Environmental Leadership: A Developmental Perspective

This article examines how the action logics associated with the stages of consciousness development of organizational leaders can influence the meaning, which these leaders give to corporate greening and their capacity to consider the specific complexities, values, and demands of environmental issues. The article explores how the seven principal action logics identified by Rooke and Torbert (2005, Harvard Business Review 83(4), 66–76; Opportunist, Diplomat, Expert, Achiever, Individualist, Strategist and Alchemist) can affect environmental leadership. An examination of the strengths and limitations of these action logics reveals the relevance of the so-called post-conventional stages of consciousness to the recognition and effective management of complex environmental issues. Suggestions are also made for promoting organizational contexts conducive to the development of a post-conventional environmental leadership.     

Pleasure and the Control of Food Intake: An Embodied Cognition Approach to Consumer Self‐Regulation

Consumers try to avoid temptation when exposed to appetizing foods by diverting their attention away from their senses (e.g., sight, smell, mouthfeel) and bodily states (e.g., state of arousal, salivation) in order to focus on their longer term goals (e.g., eating healthily, achieving an ideal body weight). However, when not including sensations in their decision‐making processes, consumers risk depleting their self‐regulatory resources, potentially leading to unhealthy food choices. Conversely, based on the concept of “embodied self‐regulation,” the suggestion is made that considering bodily states may help consumers regulate their food choices more effectively. A new model is proposed that facilitates understanding observed consumer behavior and the success or failure of self‐control in food intake. It is argued that bodily states and sensory information should be considered when modeling consumer behavior and developing health‐related advocacy and communication campaigns. The model proposed here leads to new perspectives on consumer consumption behavior and health policy research and strategies.     

Impact of Islamic Work Ethics on Organizational Citizenship Behaviors and Knowledge-Sharing Behaviors

This study examines the impact of Islamic Work Ethic (IWE) on organizational citizenship behaviors (OCBs) and knowledge-sharing behaviors (KSBs) among university employees in Pakistan. A total of 215 respondents from public sector educational institutions participated in this research. The findings suggest that IWE has a positive effect on OCBs. In other words, individuals with high IWE demonstrate more citizenship behaviors than those with low IWE. The findings also suggest a positive effect of IWE on KSBs. Individuals with high IWE exhibit more KSBs than those with low IWE. The paper also discusses the theoretical and practical implications of these findings.     

To be or not to be in monetary union: A synthesis

Monetary union can benefit countries suffering from policy credibility problems if it eliminates the inflation bias and also allows for more efficient management of certain shocks. But it also carries costs as some stabilization may be feasible even in the absence of credibility, and this may be more than what an individual country can hope for in a monetary union. In this paper, we combine the stabilization and credibility branches of the currency union literature and construct a simple welfare criterion that can be used to evaluate alternative monetary arrangements. We produce examples where monetary union may be welfare improving even for low-modest levels of inflation bias (2-3%) as long as business cycles are not too a-synchronized across countries.     

Habit formation and fiscal transmission in open economies

In this paper we analyze the ability of an open economy version of the neoclassical model to account for the time-series evidence on fiscal policy transmission. Revisiting the evidence, we find that i) government spending raises output, while inducing a simultaneous decline of investment and the current account and ii) the responses of output and investment are more muted in more open economies while current account deficits tend to be larger. Turning to the model, we explore the role of habit formation for fiscal policy transmission. Specifically, we show that the model can account for the evidence if consumption behavior is characterized by habit formation and the terms of trade adjust endogenously.     

Status, the Distribution of Wealth, and Growth

We analyze a simple model of endogenous growth in which individuals care about both consumption and their rank in the distribution of wealth. We show that the steady-growth rate of the economy increases with both the strength of the status-seeking motive and the initial equality of the wealth distribution. Contrary to the basic model of endogenous growth, the equilibrium growth rate is not necessarily smaller than in the social optimum, and we identify the circumstances under which the two coincide.