Network architecture, cooperation and punishment in public good experiments

Following Fehr and G?echter (Am Econ Rev 90(4):980–994, 2000), a large and growing number of experiments show that public goods can be provided at high levels when mutual monitoring and costly punishment are allowed. Nearly all experiments, however, study monitoring and punishment in a complete network where all subjects can monitor and punish each other. The architecture of social networks becomes important when subjects can only monitor and punish the other subjects to whom they are connected by the network. We study several incomplete networks and find that they give rise to their own distinctive patterns of behavior. Nevertheless, a number of simple, yet fundamental, properties in graph theory allow us to interpret the variation in the patterns of behavior that arise in the laboratory and to explain the impact of network architecture on the efficiency and dynamics of the experimental outcomes.     

The entrepreneurial imagination and the impact of context on the development of a new venture

This paper sets out to explore the impact of a new venture's context on its development. The study consists of a single case study based on a new venture attempting to exploit an opportunity in the life sciences and charts the impact that the context, in particular actors that the venture are trying to gain resources from, have upon the plans, activities and resources developed by this nascent firm. Spanning the time period of 1999-2006, this case outlines four periods of development of the venture. This accounts for the initial plans of the venture, their struggle to gain venture financing, the development of the venture's technological resources and the attempts to create commercial relationships. The study shows the impact that institutions used in a context have on this venture leading to, among other things, the discovery of IP, finding a CEO and developing a product line.     

The effect of annual changes in automobile fuel economy standards

Since 1978 the Federal government has regulated the fuel economy of new cars sold in the United States. The purpose of Corporate Average Fuel Economy (CAFE) standards is to lessen the national dependence on foreign oil. Through the use of theoretical and empirical models this paper examines the impact of CAFE standards on the automobile industry and on energy consumption. It is shown that CAFE standards may or may not save energy. If CAFE does save energy, it does so at a prohibitive cost to the economy. CAFE standards are also shown to have a number of perverse impacts on the automobile industry as well as consumers.     

Age-test Markov chains for drug testing and detection

Random urinalysis strategies stratified by time since the last test are characterized with a set of Markov chain models. The probability of a person being tested depends on the amount of time since the person's last test. The Nuclear Regulatory Commission (NRC) has proposed a two strata drug testing strategy based on time since last test. The proposal included a high testing rate for people not yet tested in a given time period and a low testing rate for people testing negative in a given time period. Southern California Edison has implemented a variation of the NRC proposal. These strategies can be modeled within a Markov chain framework. Time to detection is calculated as a function of testing probabilities and drug usage levels. Drug user gaming strategies are discussed with illustrations. These models are implemented as part of a U.S. Navy drug policy analysis system.     

Sportsbook pricing and the behavioral biases of bettors in the NHL

The betting market for the NHL is investigated using actual betting percentages on favorites and underdogs from real sportsbooks. Sportsbooks do not appear to attempt to price to balance the book as betting percentages are not proportional to set odds. As in the NFL and NBA, bettors are shown to have a strong preference for favorites and road favorites in particular. Simple strategies of betting against significant imbalances toward the favorite are shown to generate positive returns. Although not pricing to balance the book, sportsbooks do not appear to price to exploit known bettor biases in all cases. Clear bettor behavioral biases for road favorites are not priced into the odds as the prices set in these cases appear to be a forecast of game outcomes. Pricing as a forecast may ensure long-run viability for the sportsbook as it discourages entry into this market by informed traders and still allows the sportsbook to capture its commission on losing bets over time.     

Assessing Preference Change on the US Supreme Court

The foundation upon which accounts of policy-motivated behaviorof Supreme Court justices are built consists of assumptionsabout the policy preferences of the justices. To date, mostscholars have assumed that the policy positions of Supreme Courtjustices remain consistent throughout the course of their careersand most measures of judicial ideology—such as Segal andCover scores—are time invariant. On its face, this assumptionis reasonable; Supreme Court justices serve with life tenureand are typically appointed after serving in other politicalor judicial roles. However, it is also possible that the worldviews,and thus the policy positions, of justices evolve through thecourse of their careers. In this article we use a Bayesian dynamicideal point model to investigate preference change on the USSupreme Court. The model allows for justices' ideal points tochange over time in a smooth fashion. We focus our attentionon the 16 justices who served for 10 or more terms and completedtheir service between the 1937 and 2003 terms. The results arestriking—14 of these 16 justices exhibit significant preferencechange. This has profound implications for the use of time-invariantpreference measures in applied work.     

Understanding prediction intervals for firm specific inefficiency scores from parametric stochastic frontier models

This paper makes two important contributions to the literature on prediction intervals for firm specific inefficiency estimates in cross sectional SFA models. Firstly, the existing intervals in the literature do not correspond to the minimum width intervals and in this paper we discuss how to compute such intervals and how they either include or exclude zero as a lower bound depending on where the probability mass of the distribution of \( u_{i} |\varepsilon_{i} \) resides. This has useful implications for practitioners and policy makers, with greatest reductions in interval width for the most efficient firms. Secondly, we propose an ‘asymptotic’ approach to incorporating parameter uncertainty into prediction intervals for firm specific inefficiency (given that in practice model parameters have to be estimated) as an alternative to the ‘bagging’ procedure suggested in Simar and Wilson (Econom Rev 29(1):62–98, 2010). The approach is computationally much simpler than the bagging approach.     

Missionaries,Mercenaries Or Car Salesmen? MBA Teaching In Malaysia*

Increasing academic attention is being given to the role of management gurus, consultants, managers and academic researchers in the international diffusion of Western management ideas. This is part of wider debates on knowledge, power and globalization. Relatively little attention has been paid to the mechanisms through which diffusion takes place and, in particular, the role of academics as lecturers and business schools as disseminators of management knowledge at home and abroad. This paper draws on the authors' personal experiences and perceptions of teaching on an Executive MBA programme in Malaysia and those of their students.
Management education is growing rapidly in many regions of the world and has become highly commodified and commercialized, with Western universities competing in emerging markets for potentially lucrative local opportunities and foreign students or 'consumers'. Accordingly, the process of diffusion of Western management ideas is examined through a consumption perspective which treats the foreign MBA as a standardized commodity (much like the foreign car) with particular use, symbolic and exchange values. However, the limits of the consumption perspective in terms of both consumer sovereignty and subordination are also established in revealing deeper and more dynamic relations of power. Moreover, it is argued that while there are parallels with domestic consumption of MBAs, the teaching of MBAs in Malaysia generates added ambivalence among learners founded on global–local and development–imperialism dynamics and tensions.     

Miracle on Sixth Avenue: Information Externalities and Search

After a long dormant period, Lower Sixth Avenue in New York has under gone a rapid revitalisation. We show that a simple search theoretic model with information spillovers can explain both the period of underuse and the rapid turnaround. The model reduces to a simple equation, which allows us to do comparative statics on the duration of vacancies. We show how the solution reacts to changes in market structure and changes in search technology. The model is suggestive of difficulties that may occur in many markets in which there are changes over time in the optimal use of resources.