Network formation models with costs for establishing links

Abstract. In this paper we study endogenous formation of communication networks in situations where the economic possibilities of groups of players can be described by a cooperative game. We concentrate on the influence that the existence of costs for establishing communication links has on the communication networks that are formed. The starting points in this paper are two game-theoretic models of the formation of communication links that were studied in the literature fairly recently, the extensive-form model by Aumann and Myerson (1988) and the strategic-form model that was studied by Dutta et al. (1998). We follow their analyses as closely as possible and use an extension of the Myerson value to determine the payoffs to the players in communication situations when forming links is not costless. We find that it is possible that as the costs of establishing links increase, more links are formed.     

Interactive identity work of professionals in management: a hospital case study

ABSTRACT

Hybrid professional managers appear less effective in introducing management into public professional settings than policymakers hope. To date, research has offered little understanding of professionals’ identity transition challenge and the role of social interactions underpinning this process. We studied the identity work of hybrid doctors inside a large public health-care organization, finding that it takes place through processes of familiarizing with management, rationalizing being a hybrid, and legitimizing the new role-identity. We contribute to the literature by showing that identity work is distributed and enabled by social interactions beyond the professional group. Implications for policymakers and executives are discussed.     

On the determinants of data breaches: A cointegration analysis

Decisions in Economics and Finance - Cyber risks and particularly data breaches constitute one of the new frontiers of risk modeling for insurers across the world. We use the cointegration...     

Peer punishment in teams: expressive or instrumental choice?

A key question about human societies is how social norms of cooperation are enforced. Subjects who violate norms are often targeted by their peers for punishment. In an experiment with small teams we examine whether subjects treat punishment itself as a second-order public good. Results do not support this view and rather suggest a hard-wired taste for punishment; subjects are engaged in a cooperative task but ignore the public good characteristics of punishment.     

Evaluating the median voter model’s explanatory power

We match individual senators’ voting behavior on legislative proposals with 24 real referendum decisions on exactly the same issues with identical wording. This setting allows us to evaluate the median voter model’s quality with revealed constituents’ preferences. Results indicate a limited explanatory power of the median voter model: It explains 17.6% points more than random voting and that a senator’s probability to accept a proposal in parliament increases on average by 8.4% points when the district median voter accepts the proposal.     

Temporary hires and innovative investments

The flexicurity approach claims a positive effect of flexible labour on firm performance, also through an increased ability to innovate. Critics consider it a deregulation of the labour market, decreasing investment in human capital and innovation. We contribute to this broad debate providing an estimate of the relationships linking innovative investment, substitution investment, permanent hires and temporary hires. In particular, we aim at affirming or denying that innovative investments are accompanied by a specific kind of workforce, being it stable or flexible. In doing so, we contribute to bridge the gap among two quite separate strands of literature, as existing literature usually analyses capital and labour separately. Estimating a nonlinear recursive equation system we highlight a significant increase in the likelihood of hiring on a permanent base when the firm innovates; this holds till 2008. Afterward, during the crisis, innovating firms are more likely to hire using temporary contracts instead, a possible signal of a cost saving strategy adopted in a loose labour market by firms still able to innovate. Furthermore, both permanent and temporary hires never depend on increases in labour costs; however, substitution investment increases when labour cost increases, maybe in an attempt to increase labour productivity through a more efficient capital equipment.     

New evidence of regional income divergence in post-reform Russia

This article investigates regional income convergence in Russia during 2000–2008. We test the hypothesis in which income divergence across regions of the country should give place to income convergence as the country moves toward free market economy with strong market institutions. The study contributes to the existing literature by using the exponential smooth autoregressive Augmented Dickey–Fuller (ADF) unit root test in a panel setup, a novel econometric technique, which encompasses cross sectional dependence. Results show strong evidence of on-going regional income divergence in post-reform period.     

Partnership,reciprocity and team design

This paper studies the effect of intention-based reciprocity preferences on the free-riding problem arising in partnerships. Our results suggest a tendency of efficient partnerships to consist of members whose sensitivity to reciprocity is – individually or jointly – sufficiently high. Sufficient conditions for the implementation of the efficient strategy profile require a reciprocity-based sharing rule so that each partner gets a fraction of the output, which is a percentage of his own sensitivity to reciprocity with respect to the overall sensitivity in the team. Finally, we introduce the concept of psychological strong Nash equilibrium and show that it allows for the unique and collusion-proof implementation of the efficient strategy profile.     

An economic evaluation attached to a single-centre,parallel group,unmasked, randomized controlled trial of a 3-day intensive social cognitive treatment (can do treatment) in patients with relapsing remitting multiple sclerosis and low disability

Abstract

Aims: This trial-based economic evaluation (EE) assesses from a societal perspective the cost-effectiveness of an intensive 3-day cognitive theory-based intervention (CDT), compared to care-as-usual, in patients with relapsing remitting multiple sclerosis (RRMS) and low disability (Expanded Disability Status Scale [EDDS] score < 4.0).

Materials and methods: The trial of the EE was registered in the Dutch Trial Register: Trial NL5158 (NTR5298). The incremental cost-effectiveness ratio (ICER) was expressed in cost on the Control sub-scale of the Multiple Sclerosis Self-Efficacy Scale (MSSES) and the incremental cost-utility ratio (ICUR) in the cost per Quality Adjusted Life Years (QALY) using the EQ-5D-5L. Bootstrap, sensitivity, and sub-group analyses were performed to determine the robustness of the findings.

Results: The two groups of 79 patients were similar in baseline characteristics. The base case ICER is situated in the northeast quadrant (€72 (40.74/€2,948)) due to a higher MSSES Control score and higher societal costs in the CDT group. The ICUR is situated in the northwest (inferior) quadrant due to losses in QALY and higher societal costs for the CDT group (?0.02/€2,948). Overall, bootstrap, sensitivity, and sub-group analyses confirm the base case findings. However, when the SF-6D is used as a study outcome, there is a high probability that the ICUR is situated in the northeast quadrant.

Limitations: The relative short follow-up time (6?months) and the unexpected increase in MSSES Control in the control group.

Conclusions: When using the EQ-5D-5L to calculate a QALY, CDT is not a cost-effective alternative in comparison to care as usual. However, when using self-efficacy or SF-6D as outcomes, there is a probability that CDT is cost-effective. Based on the current results, CDT for patients with RRMS clearly show its potential. However, an extended follow-up for the economic evaluation is warranted before a final decision on implementation can be made.