Searching for Goldilocks: The Distance‐Based Capitalization Effects of Local Public Services

This article empirically models the effect of distance on residential property values of three different types of services, fire, police and emergency medical services. Interesting economic trade‐offs emerge as service station proximity provides both amenity and disamenity effects. Using over three million home sales from the state of Florida along with two different measures of distance, this study provides evidence of nonlinear capitalization effects on local housing values. A difference‐in‐difference model utilizing new facility construction provides corroborating evidence of these findings.     

An instrumental variable approach to distinguishing perceptions from preferences for beer brands

Recent developments in behavioral economics have prompted interest in identifying how product perceptions and beliefs influence decision making. Using a branded discrete choice experiment for beer, this article uses the control function approach and plausible instruments to correct for the endogeneity problem in a way that is applicable in a wide range of circumstances. Even after correction, we find that perceptions substantially affect consumer choices. In the context of brand equity for beer brands, we find that the perceived taste and brand familiarity are key determinants of choice.     

Japanese managerial and organizational learning

The article describes how the external forces of Japanese culture, industrial organization, and government intervention support managerial and organizational learning. It provides an overview of the culturally explicit philosophies that govern and stimulate learning in Japan, then explains how these philosophies are exhibited in Japanese management practice today. A model is presented which demonstrates the relationships among external forces, philosophical origins, management practice, and managerial and organizational learning. The conclusion is that managerial and organizational learning constitute one of Japan's most valuable competitive advantages. © 1998 John Wiley & Sons, Inc.     

Entrepreneurial response to interstate regulatory competition: evidence from a behavioral discrete choice experiment

Journal of Regulatory Economics - Despite a developing literature exploring the relationship between regulation, taxation and business startups, few studies have utilized artefactual experimental...     

Outside CEOs and innovation

Research Summary: Innovation is the principle driver of firm and economic growth. Thus, one disturbing trend that may explain stagnant growth is a 65% decline in firms’ R&D productivity. We propose that the rise of outside Chief Executive Officers (CEOs) may be partially responsible for the decline because those CEOs are more likely to lack technological domain expertise necessary to manage R&D effectively. While this proposition was motivated by interviews with Chief Technology Officers (CTOs), we test it at large scale. We find that firm R&D productivity decays during the tenure of outside CEOs relative to that of inside CEOs. We further find this effect is more pronounced for firms with high R&D intensity and for firms employing outside CEOs with more remote experience, lending circumstantial support for the underlying assumption regarding lack of expertise. Note that this is not a call for boards to avoid outside CEOs, rather it is recommendation to consider the implications for innovation. Managerial Summary: While outside CEOs offer advantages over internal candidates, we argue one unintended consequence is weaker innovation. This argument was prompted by two coincident trends: a 65% decline in companies’ R&D productivity and a doubling of outside Chief Executive Officers (CEOs). The argument was reinforced by interviews with Chief Technology Officers (CTOs), who recounted shifts in orientation from R&D as an investment to R&D as an expense that occurred shortly in response to a new CEO. We felt this shift was more likely with outside CEOs because they may lack technological domain expertise necessary to effectively manage R&D. Our results are consistent with the argument—company R&D productivity decreases under outside CEOs. Note, however, that we don’t advocate avoiding outside CEOs, rather we recommend R&D firms consider technological domain expertise during CEO hiring.     

eWOM Watchdogs: Ego‐Threatening Product Domains and the Policing of Positive Online Reviews

Suspicion regarding dishonest electronic word‐of‐mouth is a growing concern for consumers online. Individual consumers are occasionally seen acting as product review forum “watchdogs” within the websites they visit, posting vigilante comments against reviews they perceive to be fraudulent. This multimethod set of studies investigates consumer “watchdog comments,” and the way in which ego‐threatening product categories themselves may actually induce a prosecutorial mindset, leading to greater levels of suspicion toward positive online product reviews and the impulse to prosecute potential fraudsters. In Study 1, laboratory‐induced ego threat increased punitive severity against the act of falsifying online product reviews. In Study 2, a content analysis of actual Amazon.com reviews and consumer commentary indicates that the occurrence of watchdog comments is more common within ego‐threatening product categories.     

Cognition, Persuasion and Decision Making in Older Consumers

Older adults constitute a rapidly growing demographic segment, but relatively little is known about them within consumer contexts: how they process information, respond to persuasive messages, and make decisions. We discuss extant findings from consumer behavior and related disciplines (e.g., cognitive psychology, neuroscience, social psychology, gerontology) as they pertain to the effects of aging on consumer memory, persuasion and decision The first two authors co-chaired the workshop at the Choice Symposium and made major and equal contributions to this article. The remaining authors were participants in the workshop. They also contributed to this article and are listed in alphabetical order. We wish to thank the editor and Cathy Cole for their helpful comments on the paper. The article, including a more complete list of references, was shortened to meet the page-length constraints of the special issue. The longer version is available upon request from the senior authors.