Directed search with multiple job applications

We develop an equilibrium directed search model of the labor market where workers can simultaneously apply for multiple jobs. Our main theoretical contribution is to integrate the portfolio choice problem faced by workers into an equilibrium framework. All equilibria of our model exhibit wage dispersion. Consistent with stylized facts, the density of wages is decreasing and higher wage firms receive more applications per vacancy. Unlike most models of directed search, the equilibria are not constrained efficient.     

Managerial decision making in customer management: adaptive, fast and frugal?

While customer management has become a top priority for practitioners and academics, little is known about how managers actually make customer management decisions. Our study addresses this gap and uses the adaptive decision maker as well as the fast and frugal heuristics frameworks to gain a better understanding of managerial decision making. Using the process-tracing tool MouselabWEB, we presented sales managers in retail banking with three typical customer management prediction tasks. The results show that a majority of managers in this study are adaptive in their decision making and that some managers use fast and frugal heuristics. Usage of adaptive decision making seems to be mainly driven by low objective task difficulty, the use of fast and frugal heuristics by experience. While adaptive decision making does not impact predictive accuracy, usage of fast and frugal heuristics is associated with proportionally greater use of high predictive quality cues and a significant increase in accuracy. Hence, the existing skepticism concerning heuristics should be questioned.     

WORDS, DEEDS AND OUTCOMES: A SURVEY ON THE GROWTH EFFECTS OF EXCHANGE RATE REGIMES

Abstract.  Recent studies on the growth effects of exchange rate regimes offer a wide range of different, sometimes contradictory results. In this paper, we systematically compare three prominent contributions in this field. Using a common data set, a common specification and common estimation methods, we argue that the contradictory findings can be explained by the fact that these studies use regime classifications which reflect fundamentally different aspects of exchange rate policy.     

Controlling der Qualität von Kundenstammdaten bei der Roche Diagnostics GmbH

Ohne Zusammenfassung     

Matching markets with price bargaining

The extant microeconomic literature on matching markets assumes ordinal preferences for matches, while bargaining within matches is mostly excluded. Central for this paper, however, is bargaining over joint profits from potential matches. We investigate, both theoretically and experimentally, a seemingly simple allocation task in a 2×2 market with repeated negotiations. When inefficiency is possible, about 1/3 of the complete matches are inefficient and, overall, more than 3/4 of the experimental allocations are unstable. These results strongly contradict existing bargaining theories requiring efficient matches. Even with regard to efficient matches, the tested theories perform poorly. Standard bargaining and behavioral concepts, such as Selten’s (1972) Equal Division Core, are outperformed by the simplistic ε-Equal Split, i.e., an equal split of the joint profit plus/minus ε.     

Designing for Cost Transparency in Investment Advisory Service Encounters

Investment advisory services of financial service providers (FSPs) exhibit several characteristics that are detrimental to advisory quality. The interaction of advisor and client is strained by a lack of transparency regarding the advisory process (what activities are performed and why) and the information used therein (what information is used for what purpose and with what effect), as well as regarding the precise costs of the service and the recommended products. In prior research, we suggested that process and information transparency issues may be appropriately addressed with collaborative information technology (IT) artifacts. In this paper, we argue that collaborative, transparent artifacts may also be a premise of enabling cost transparency. To this end, we describe a complete research cycle of designing, implementing, and evaluating a shared cost-transparent IT artifact to support client-advisor interaction in investment advisory encounters. Evaluation results suggest the efficacy of our design in improving the clients?? perceived cost transparency as well as increase their satisfaction and their willingness to pay for the received investment advice. These findings may also challenge the common belief of FSPs that transparent, fee-based advisory services would neither be accepted by clients nor be economically viable. Practical implications of these findings for designing advisory encounters with supportive IT are discussed.     

Social capital of venture capitalists and start-up funding

How does the social capital of venture capitalists (VCs) affect the funding of start-ups? By building on the rich social capital literature, we hypothesize a positive effect of VCs?? social capital, derived from past syndication, on the amount of money that start-ups receive. Specifically, we argue that both structural and relational aspects of VCs?? social networks provide VCs with superior access to information about current investment objects and opportunities to leverage them in the future, increasing their willingness to invest in these firms. Our empirical results, derived from a novel dataset containing more than 1,500 first funding rounds in the Internet and IT sector, strongly confirm our hypotheses. We discuss the implications of our findings for theories of venture capital and entrepreneurship, showing that the role and effect of VCs?? social capital on start-up firms may be more complex than previously argued in the literature.     

How burning money requires a lot of rationality to be effective

This paper proposes an extension of the valuation equilibrium concept (Jehiel and Samet, 2007), which partly endogenises the underlying grouping of actions. The effect on equilibrium predictions is illustrated in a burning money game.     

Increasing workload in a stochastic environment

We show that a steeply increasing workload before a deadline is compatible with time-consistent preferences. The key departure from the literature is that we consider a stochastic environment where success of effort is not guaranteed.