Programming and Advertising Competition in the Broadcasting Industry

We analyze competition between two private television channels that derive their profits from advertising receipts. These profits are shown to be proportional to total population advertising attendance. The channels play a sequential game in which they first select their profiles (program mixes) and then their advertising ratios . We show that these ratios play the same role as prices in usual horizontal differentiation models. We prove that whenever ads' interruptions are costly for viewers the program mixes of the channels never converge but that the niche strategies are less effective and that the channel "profiles" are closer as advertising aversion becomes stronger.     

Knowledge, hierarchy and the selection of routines: an interpretative model with group interactions

The aim of this paper is to analyze the selection of routines inside an organizational structure characterized by different cognitive representations and facing hierarchical pressure leading to either truce or conflict. After a brief discussion of the role of hierarchy and the related problems of organizational practice selection in the evolutionary literature, we model the interactions between different groups within a firm trying to interfere with its coordination mechanisms in order to support their own practices. Numerical simulations highlight the different learning abilities present in various organizational set-ups and their related knowledge distribution. It is shown that networking designs are the most profitable organizational configurations because of their dynamics of learning, though they are very sensitive to the truce problem.JEL Classification: L14, L20, L22, B52, D83Correspondence to: Nathalie Lazaric     

Digital silk road,Silicon Valley and connectivity

In this article, we provide an up-to-date analysis of innovation and the Belt and Road Initiative (BRI). We argue here that the confluence of technology and the Silk Road is not new. During the Ancient Silk Road, China’s indigenous innovations diffused to other economies (the first process of diffusion). What is new this time is that much of the innovations may have originated in Silicon Valley, California. However, China adapted, metamorphosized some such inventions and at the same time independently created many technology business models. Through the New Silk Road, China may carry out a second diffusion process and spread innovations from Silicon Valley to other BRI countries. To enrich the study of the Digital Silk Road, we construct a formal, economic model of a connected region and show how this can affect Internet start-ups and their entrepreneurs.

We are very grateful for many constructive comments provided by two anonymous referees and an editor. We have improved and revised our article according to their very useful suggestions. All errors, however, remain ours.     

The ambiguous role of cultural moderators in intercultural business negotiations

Many modern business negotiations cross borders, and one plausible idea for successfully managing such negotiations is to equip negotiation teams with a “cultural moderator,” an individual who has the same cultural background as the business partner. This study investigates the effect of cultural moderators on both the negotiation process (e.g., use of integrative strategies) and economic outcomes (e.g., profit). Using German and French negotiators in an experimental setting, the authors show that a cultural moderator's influence on the team's use of integrative strategies depends on the moderator's degree of collectivism. With respect to economic outcomes, the presence of a cultural moderator always improves a team's results. Together, these findings suggest that the benefits of using a cultural moderator are not unconditional; rather, they depend on the cultural moderator's cultural background and on the negotiation goals (process vs. outcome) of the team that employs the moderator.     

Individual utility in a context of asymmetric sensitivity to pleasure and pain: an interpretation of Bentham's felicific calculus

This paper aims at exploring, in a formal way, Bentham's statement that ‘the pleasure of gaining is not equal to the evil of losing’, which belongs to those aspects of the principle of utility left aside by Jevons‘ reconstruction. Consequently, the agent’s preference order will be viewed as depending on his initial situation, and on asymmetric sensitivity to gains and losses, relative to this situation. This leads 1) to discuss the coexistence of multiple preference orders, illustrated by Bentham's analysis of the optimal labour contract; and 2) to introduce true deliberation as a consequence of the gap between positive choice and rival assessments of utility.     

EXPLAINING RISING INEQUALITY: SKILL‐BIASED TECHNICAL CHANGE AND NORTH–SOUTH TRADE*

Abstract We review the ‘skill‐biased technological change (SBTC) versus North–South trade (NST)’ debate in order to explain widening wage inequality between skilled and unskilled workers. The traditional explanations based on exogenous SBTC and on the North–South Heckscher–Ohlin–Samuelson approach, as well as the early estimates that diagnosed a clear prevalence of the former, are firstly exposed and discussed. A presentation is then made of the recent theoretical literature that endogenizes SBTC, introduces new channels of impacts from NST, and combines both explanations. Finally, the current estimates show that (i) both explanations are relevant, (ii) their impacts differ according to industries and countries, (iii) outsourcing is the main vector of impact from NST and (iv) SBTC and NST interact.     

Do Environmental CSR Initiatives Serve Organizations’ Legitimacy in the Oil Industry? Exploring Employees’ Reactions Through Organizational Identification Theory

Little is known about employees’ responses to their organizations’ initiatives in corporate social responsibility (CSR). Academics have already identified a few outcomes regarding CSR’s impact on employees’ attitudes and behaviours; however, studies explaining the underlying mechanisms that drive employees’ favourable responses to CSR remain largely unexplored. Based on organizational identification (OI) theory, this study surveyed 155 employees of a petrochemical organization to better elucidate why, how and under which circumstances employees might positively respond to organizations’ CSR initiatives in the controversial oil industry sector. Findings first support that perceived CSR (i.e. environmental CSR) positively relates to employees’ OI which is known as an important antecedent of employees’ outcomes (Riketta, J Vocat Behavior, 66(2):358, 2005). Furthermore, results highlighted that the relationship between perceived CSR and employees’ OI is mediated by organizational trust. Finally, this study also revealed that some contingency factors such as employees’ attributions of self-centred motives to their organization’s investment in environmental issues can moderate the relationship between perceived CSR and organizational trust. Based on these findings, it is argued that CSR initiatives can support organizations’ efforts to maintain a strong relationship with their employees, and gain their support even in a controversial industry sector.     

Process and context in choice models

We develop a general framework that extends choice models by including an explicit representation of the process and context of decision making. Process refers to the steps involved in decision making. Context refers to factors affecting the process, focusing in this paper on social networks. The extended choice framework includes more behavioral richness through the explicit representation of the planning process preceding an action and its dynamics and the effects of context (family, friends, and market) on the process leading to a choice, as well as the inclusion of new types of subjective data in choice models. We discuss the key issues involved in applying the extended framework, focusing on richer data requirements, theories, and models, and present three partial demonstrations of the proposed framework. Future research challenges include the development of more comprehensive empirical tests of the extended modeling framework.     

Risk Mutualization and Competition in Insurance Markets

The aim of this paper is to analyze the impact of mutual firms on competition in the insurance market. We distinguish two actors in this market: mutual firms, which belong to their pooled members, and traditional companies, which belong to their shareholders. Our approach differs from the literature by one crucial assumption: the expected utility of the consumers depends on the size of their insurance firm, which generates network externalities in this market. Thus, the choice of a contract results in a trade-off between the premium level and the probability of that premium being ex-post adjusted. The optimal contract offered by a mutual firm involves a systematic ex-post adjustment (negative or positive), while the contracts a company offers imply a fixed premium that is possibly negatively adjusted at the end of the contractual period. In an oligopoly game, we show that three types of configurations are possible at equilibrium: either one mutual firm or insurance company is active, or a mixed structure emerges in which two or more companies share the market with or without a mutual firm.