Dissertation abstract: Experiments on fairness and reputation

The three dissertation essays investigate different aspects of reputation in games where fairness is an important consideration. The first essay studies the effects of reputation on indirect reciprocity in different dictator games. The first experiment places dictators in two environments where they can either give money to the paired player or take money away from them: in one treatment the paired player is a stranger and in the other treatment the dictator has information on the paired player’s reputation. Contrary to anecdotal evidence, the statistical tests show that the dictators’ behavior towards a stranger is not statistically significantly different from their behavior towards an individual with an established reputation. The findings arise because a high proportion of dictators acted purely in their own self interest in both treatments. The data also provides evidence that dictators are more generous when they know that their choices (but not their identities) will be revealed in the future. In the second experiment the dictators’ choices were restricted to only generous actions. In such environment the dictators sent more money on average to recipients with a reputation for being generous than to recipients without a reputation. The second essay explores the ways in which information about others’ actions affects one’s own behavior in a dictator game. The experimental design discriminates behaviorally between three possible effects of recipient’s within-game reputation on the dictator’s decision: reputation causing indirect reciprocity, social influence, and identification. The separation of motives helps to identify the mechanisms of social transmission of impulses towards selfish or generous behavior. The data analysis reveals that the reputation effects have a stronger impact on dictators’ actions than social influence and identification. In the third essay¹ we examine the reputation effects in a labor market setting by analyzing the influence of negative technological shocks on long run relationships between firms and workers. The positive correlation between wage and effort in static conditions has been demonstrated in many experimental studies and has been one of the prominent explanations for the existence of wage rigidity. We subject these findings to further tests in a non-stationary environment that better corresponds to outside-the-lab market conditions. We observe the positive correlation of wages and effort but do not find support for downward wage rigidity in our data. Once the shocks occur, firms lower the wages and relationships often break down. The workers who accept a lower wage respond with exerting a lower effort. JEL Classification C70, C91, D63, D64 ¹Co-authored with Ninghua Du. Dissertation Committee: Dissertation Advisor: James C. Cox Martin Dufwenberg, Price V. Fishback, Ronald L. Oaxaca     

Problems and environment of small businesses in the Czech Republic

The impressive and spontaneous build-up of the private small and medium-sized enterprises (SMEs) in the Czech Republic in 1990–93 coincided with the similarly dramatic changes in the public administration and in the whole environment for decision-making. The resulting problems of SMEs in the Czech Republic seem to be common to all economies in transition. A lot of the problems are caused by the macroeconomic policy for which this sector is not the most important part of the national economy. The paper shows some conflicts between macroeconomic anti-inflationary (monetary and fiscal) policies, and interests of small businesses. The authors stress the importance of SMEs during the period of transition. Informal aspects of the functioning of small firms are discussed, especially their relation with banks and public administration. The paper offers some empirical evidence and available statistics on SMEs developments during 1990–94 focusing particularly on manufacturing.     

Export Sophistication: A Dynamic Panel Data Approach

In this article, we analyze export sophistication based on a large panel dataset (2001–2015; 101 countries) and using various estimation algorithms. Using Monte Carlo simulations, we evaluate the bias properties of estimators and show that GMM-type estimators outperform instrumental-variable and fixed-effects estimators. Based on our analysis we document that GDP per capita and the size of the economy exhibit significant and positive effects on export sophistication; weak institutional quality exhibits negative effect. We also show that export sophistication is path-dependent and stable even during a major economic crisis, which is especially important for emerging and developing economies.     

Das allgemeine Schema des wirtschaftlichen Kreislaufes

Ohne Zusammenfassung     

Entrepreneurial cognition and internationalization speed: towards a potential moderating effect of experiential and rational information processing

This study explores the influence that entrepreneurial cognition, in terms of the dichotomy in human information processing, has on the earliness of internationalization and post-entry speed. Entrepreneurial cognition is investigated through the lens of the dual-process theory, which posits that human information processing is formed of two systems, the experiential cognitive system (System 1) and the rational and analytical cognitive system (System 2). The speed of the entire internationalization process is analyzed in terms of earliness (how soon after inception a company enters its first international market) and post-entry speed (how fast it enters new markets after the first internationalization). Drawing on ten cases, we find that companies that internationalized earlier and faster were managed by entrepreneurs with higher levels of the experiential cognitive system. In contrast, companies that internationalized later and more gradually were managed by entrepreneurs with higher levels of the rational cognitive system. Thus, our study reveals that the speed of the entire process of internationalization is governed, at least partially, by the entrepreneur’s cognition. On the basis of our findings, we introduce three propositions on the moderation that the entrepreneur’s cognition exerts on the well-established relations between environmental signals and both earliness of internationalization and post-internationalization speed.

     

Divestitures,privatization and corporate performance in emerging markets

We use new firm‐level data to examine the effects of firm divestitures and privatization on corporate performance in a rapidly emerging market economy. Unlike the existing literature, we control for accompanying ownership changes and the fact that divestitures and ownership are potentially endogenous variables. We find that divestitures increase the firm's profitability but do not alter its scale of operations, while the effect of privatization depends on the resulting ownership structure – sometimes improving performance and sometimes bringing about decline. The effects of privatization are thus more nuanced than suggested in earlier studies. Methodologically, our study provides evidence that it is important to control for changes in ownership when analyzing divestitures and to control for endogeneity, selection and data attrition when analyzing the effects of divestitures and privatization.