The marketing of love: how attachment styles affect romantic consumption journeys

Journal of the Academy of Marketing Science - The experience of romantic love is closely interlocked with consumption journeys—yet how and why consumers engage in romantic consumption is not...     

When it pays to have a friend on the inside: contingent effects of buyer advocacy on B2B suppliers

As organizational buying systems grow more complex and sophisticated, suppliers increasingly rely on buyer advocacy: an individual buyer’s efforts to influence his/her colleagues such that the supplier’s standing is improved. Drawing from cognitive response theory, the authors hypothesize an inverted U-shaped relationship between a buyer’s advocacy for a supplier and the customer’s purchases from that supplier. They theorize that this effect is moderated by the advocate’s industry experience and customer–supplier relationship characteristics. An analysis of multisource data from a B2B service provider (Study 1) supports the predicted inverted U-shaped relationship, while a unique dataset from a large industrial supplier (Study 2) provides broad support for the hypothesized moderators. Finally, a randomized experiment (Study 3) replicates key findings and corroborates the theorized cognitive response mechanisms. Findings contribute to the limited literature on buyer advocacy within the organizational buying domain and offer practical implications for suppliers and buyers.

     

SNAP and Paycheck Cycles

It is well documented that individuals do not spend the Supplemental Nutrition Assistance Program (SNAP) benefits smoothly over the month after receipt. Rather, recipients spend a disproportionate share of benefits at the beginning of the benefit month. This has costs for recipients and stores. There is also evidence that other income streams, such as Social Security and paychecks, are not spent smoothly. The presence of these other income streams may bias estimates of the effects of this SNAP cycle on consumption for working SNAP beneficiaries and those who receive other government benefits. We use data from United States Department of Agriculture's National Household Food Acquisition and Purchase Survey to explore how the SNAP cycle is affected by accounting for these other income streams. We find suggestive evidence that the cycle is more pronounced for workers who are paid on a weekly or monthly basis, but little evidence that cycles in other income streams mitigate or exacerbate the SNAP cycle.     

Negotiating with Terrorists: The Costs of Compliance

It is often argued that negotiating with terrorists will encourage terrorist attacks. To date, corroborating empirical evidence is scarce. Using ITERATE data, we investigate the impact of conceding to terrorist demands on terror activity. We restrict attention to hostage events with clear‐cut demands from terrorists. Our sample period runs from 1978 to 2005 and comprises 1435 events in 125 countries. Estimating a flexible and dynamic Structured Additive Regression model, we find that the percentage of successfully negotiated events has a nonlinear effect on future terror intensity consistent with our simple theoretical model. More specifically, although moderate rates of negotiation increase the number of future terror events, higher negotiation rates tend to have the opposite effect. The estimated threshold is around 20%.     

Tax Reporting Behavior Under Audit Certainty

This study uses a confidential data set of firms assigned to the Internal Revenue Service's Coordinated Industry Case (CIC) program to examine the effect of audit certainty on firms' tax reporting behavior. We first model the determinants of assignment to the program. Although the ability and incentive to avoid taxes are related to CIC assignment, we find that the IRS assigns firms primarily based on size and complexity. We then test whether audit certainty has a detectable effect on tax payments. Our results show that tax payments do not change when firms enter the CIC program, suggesting the CIC program does not have higher deterrence or enforcement effects relative to the IRS's standard selection and audit process for large corporations not included in the CIC program. However, supplemental analysis suggests that audit certainty does alter managers' expectations regarding future tax payments. Our paper provides new empirical evidence on the strategic game between the taxpayer and the tax authority and has important implications for tax authorities as they consider the costs and benefits of certain audit programs.     

How Does Using a Mobile Device Change Investors’ Reactions to Firm Disclosures?

I examine how characteristics of investors’ information access tools change investors’ reactions to firm disclosures. I examine my research question in the context of information choice (i.e., allowing investors to choose the order of information and sections to read within a disclosure) and spatial layout (i.e., how information is displayed when viewing the disclosure). Results of an experiment are consistent with information choice improving investors’ judgments if the disclosure is viewed on a computer screen. Conversely, and consistent with cognitive overload, information choice harms investors’ judgments if the disclosure is viewed on a smaller screen, such as that of a mobile device. Follow-up experiments show that changing the disclosure presentation to reduce the need to scroll is one way to improve investors’ judgments on a smaller (or mobile) screen. My findings caution firms and regulators about expanding information choice within disclosures without considering the screen size used to access the disclosure.     

Consumption Fluctuations and Expected Returns

This paper introduces a novel consumption-based variable, cyclical consumption, and examines its predictive properties for stock returns. Future expected stock returns are high (low) when aggregate consumption falls (rises) relative to its trend and marginal utility from current consumption is high (low). We show that the empirical evidence ties consumption decisions of agents to time variation in returns in a manner consistent with asset pricing models based on external habit formation. The predictive power of cyclical consumption is not confined to bad times and subsumes the predictability of many popular forecasting variables.     

The dark side of individual blockholder philanthropy

We examine the market reaction to charitable pledges by individual blockholders of public firms. As this philanthropy may signal a weakening preference for wealth maximization and may be indicative of distraction or relaxed monitoring, these agency costs may overwhelm any reputation benefits. We find decreased firm value and lower pay-for-performance sensitivity, the effects of which are most severe where monitoring needs are high, the blockholder is a director, or when the firm has ex ante high corporate social responsibility ratings. Our results are robust to controlling for prior charitable foundation involvement, busy director–blockholders, dual-class share structures, blockholder exit, and pre-pledge firm sentiment.     

The derived demand for faculty research

Estimation of the demands for many services supplied by government and charitable organizations are hampered by two practices common to the supply of these services. The suppliers often employ non‐price rationing of these services, and they price discriminate. The supply of college training, for example, is rationed on the basis of academic ability as well as willingness to pay, and more able students are typically quoted lower net prices (associated with scholarships) than less able students. This paper suggests a method for dealing with both practices in the analysis of cross‐sectional data. This methodology is used to investigate the question of why university faculty members are expected to do research as well as teach. One answer supported by our empirical work is that the customers (e.g., the students) demand it. Thus, controlling for price and non‐academic features, better students will choose to attend a university where more scholarly research is performed. Moreover, our empirical findings also support a strong negative link between faculty time devoted to teaching and the supply of research. Copyright © 2003 John Wiley & Sons, Ltd.     

Temporary jobs and job search effort in Europe

Using longitudinal data on individuals from the European Community Household Panel (ECHP) for eleven countries during 1995-2001, I investigate temporary job contract duration and job search effort. The countries are Austria, Belgium, Denmark, Finland, France, Greece, Ireland, Italy, the Netherlands, Portugal and Spain. I construct a search model for workers in temporary jobs which predicts that shorter duration raises search intensity. Calibration of the model to the ECHP data implies that at least 75% of the increase in search intensity over the life of a 2+ year temporary contract occurs in the last six months of the contract. I then estimate regression models for search effort that control for human capital, pay, local unemployment, and individual and time fixed effects. I find that workers on temporary jobs indeed search harder than those on permanent jobs. Moreover, search intensity increases as temporary job duration falls, and roughly 84% of this increase occurs on average in the shortest duration jobs. These results are robust to disaggregation by gender and by country. These empirical results are noteworthy, since it is not necessary to assume myopia or hyperbolic discounting in order to explain them, although the data clearly also do not rule out such explanations.