Voting Paradoxes and MCDM

Many, if not most, problems in group decision making can be translated into MCDM problems by substituting criteria for voters. Yet, there has been very little discussion about the implications of various types of voting paradoxes to MCDM. The classic voting paradoxes, viz. Borda's and Condorcet's, have obvious implications for certain MCDM situations. The latter implies that the notion of the best alternative, given a set of criteria and information about the ordinal ranking of the alternatives on those criteria, can be essentially arbitrary. The former, in turn, demonstrates a particularly clear case of conflict between reasonable intuitions. Completely unexplored are implications of compound majority paradoxes to MCDM. The paper deals with Ostrogorski's and Anscombe's paradoxes which result from non-bisymmetry and non-associativity of the majority relation. Moreover, we shall discuss the implications of paradox of multiple elections which is a situation where the result of multiple-item election may be a policy alternative that nobody voted for.     

Cryptographic protocols for Vickrey auctions

Although the sealed second-price or Vickrey auctions have some nice theoretical properties, they are fairly seldom utilized in practice. It has been suggested that they are vulnerable to bid-taker cheating and that the revelation of bids after the bidding makes the bidders reluctant to reveal their true valuations. We outline procedures based on modern mathematical cryptography that are instrumental in avoiding some of these difficulties and thereby will improve the properties of the Vickrey auctions.     

A comparison of regret-based and utility-based discrete choice modelling – an empirical illustration with hospital bed choice

There is some concern that the unobserved preference heterogeneity in random utility maximization theory-based discrete choice experiment modelling is an important source of error variability. The randomness in utility is often interpreted as interpersonal preference heterogeneity but it can also be intrapersonal random variation in preferences. We compare utility maximization and regret minimization-based choice models’ sensitivity to individual heterogeneity, examine differences between two consecrated models and validate with empirical illustrations. We use frequency of category (public, semi-private, and private) of bed chosen from Swiss cross-sectional datasets (2007–2012) to compare two approaches – utility maximization and regret minimization by applying multinomial logit (MNL) models in regard to the variances in utility (regret) function, goodness-of-fit and predicted marginal effects (pseudo-elasticity) of additional payment. We find parameters with the same sign and estimates with almost same order of magnitude in both the approaches. The statistical significance of attribute effects is consistent in all variants of utility -based MNL models while effects of different attributes are significant only in heteroskedastic extreme value (HEV) variant of regret-based MNL models. This empirical illustration suggests that HEV variant of regret-based models perform better in capturing attribute effects in choice behaviour.     

Understanding consumers' online conversation practices in the context of convenience food

The area of convenience food has become an insightful context for studying consumption because it is full of tensions and contradictions. This context has attracted an ample amount of research on buying motivations, consumer attitudes and preferences. However, the practices of consuming convenience food have remained a rather unexplored area of research. The purpose of this study is to identify and dissect consumers' online conversation practices related to convenience food. Consequently, the study uses a practice theoretical approach to analyse consumers' online conversations about the topic. Three different categories and nine different practices within them are identified. The practices are further dissected to reveal their tension‐increasing and tension‐relieving characteristics. Finally, the article draws conclusions regarding practice theory and convenience food consumption.     

The Drivers of Responsible Investment: The Case of European Pension Funds

We investigate what drives responsible investment of European pension funds. Pension funds are institutional investors who assure the income of part of the population for a long period of time. Increasingly, stakeholders hold pension funds accountable for the non-financial consequences of their investments and many funds have engaged in responsible investing. However, it appears that there is a wide difference between pension funds in this respect. We investigate what determines pension funds’ responsible investments on the basis of a survey of more than 250 pension funds in 15 European countries in 2010. We use multinomial logistic regression and find that especially legal origin of the country, ownership of the pension fund and fund size-related variables are to be associated with pension funds′ responsible investment. For fund size, we establish a curvilinear relationship; especially the smallest and largest pension funds in the sample tend to engage with responsible investing.     

Efficiency and monotonicity of bargaining solutions

A continuity axiom for bargaining solutions is introduced, which is satisfied by all Pareto optimal and continuous (in the Hausdorff metric) solutions. It is shown by two examples how this axiom can be used to characterize solutions having certain kind of monotonicity properties. One of the solutions is the lexicographic maximin solution. The other is the lexicographic extension of the Kalai-Smorodinsky solution. The former is an efficient (Pareto optimal) extension of the symmetric proportional solution. The latter is an efficient extension of the Kalai-Smorodinsky solution.     

Combining verbal analysis protocol and wireless audiovisual observation to examine consumers' supermarket shopping behaviour

The study investigates the benefits of using a verbal analysis protocol combined with wireless audiovisual observation technology to collect information about consumer behaviour in real‐life environments. A sample of consumers (n = 36) were given a task to select food products in 11 different categories in a supermarket. Combining methods enabled simultaneous collection of multiple forms of qualitative and quantitative data by recording data simultaneously from different perspectives: the consumer's visual range; the wider shopping environment, to provide context; the consumer's verbalizations. Qualitative data on extrinsic and intrinsic factors that affect decision making and quantitative data on product selection time were taken as an example of rich and real‐time data obtained using the combined methods. Audiovisual material was analysed by Usability Test Software 2.0, verbal analysis data were sorted by a database programme and quantitative data were processed using SPSS 17.0. The study design provided sensitive verification of the nature of consumer interaction with the shopping environment: e.g. during the product selection time (average 23 ± 10 s/product), the interaction with the environment varied between individuals and among products selected. The approach represents a useful technique to enable the value of consumer input to direct innovation in consumer‐oriented product development. It also offers new perspectives to consumers and authorities and related organizations to understand shopping behaviour and the role of critical factors behind the food choices at the supermarket.     

Networks and Local Environmental Characteristics in the Survival of New Firms

This study seeks firstly to clarify which networks at start-up situation and early in life influence the survival of new firms. Secondly the study examines regional differences in the success of new firms. The subjects were firms which had closed down during their fourth to sixth year of operations, and they were compared with firms continuing in business. The results indicate, firstly, that it is networks internal to firm that create competitive advantage, innovation and efficiency. Secondly, management based on working in groups was emphasized in the firms that continued in business. In a typical family enterprise, ownership, management and family are united in a single entity. In other types of firms networks are seen as participating in the strategic management of the firm. Thirdly, close-downs were often caused by uncontrolled risks. A firm which fails after a successful start-up often tends to grow rapidly in the beginning, leaning on its product idea, but this rate of growth is too high from the viewpoint of the financing and the management of the firm. In firms which closed the growth objectives were too ambitions compared with the resources of the entrepreneur.