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Book part
Publication date: 16 January 2014

Jean Paul Rabanal

The chapter studies strategic default using an experimental approach.

Abstract

Purpose

The chapter studies strategic default using an experimental approach.

Design/methodology/approach

The experiment considers a stochastic asset process and a loan with no down-payment. The treatments are two asset volatilities (high and low) and the absence and presence of social interactions via a direct effect on the subject's payoff.

Findings

I demonstrate that (i) people appear to follow the prediction of the strategic default model quite closely in the high asset volatility treatment, and that (ii) incorporating social interactions delays the strategic default beyond what is considered optimal.

Originality/value

The study tests adequately the strategic default using a novel experimental design and analyzes the neighbor's effect on that decision.

Details

Experiments in Financial Economics
Type: Book
ISBN: 978-1-78350-141-0

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Book part
Publication date: 18 December 2016

Shereen J. Chaudhry and David Klinowski

We investigate whether giving workers autonomy through delegation of contract choice intrinsically motivates effort. In a novel laboratory experiment that controls for…

Abstract

We investigate whether giving workers autonomy through delegation of contract choice intrinsically motivates effort. In a novel laboratory experiment that controls for contract preferences and outcomes, principals can either choose the contract under which agents work on a real-effort task, or delegate the contract choice to the agents. We evaluate whether agents exert higher effort when they are allowed to choose the contract versus when the contract is imposed on them. We find no difference between the two conditions, even after controlling for baseline ability and for locus of control. Because our design excludes the possibility that preferences play a role, and because workers engaged in a real-effort task, this result casts doubt on an intrinsic link between the autonomy granted through delegation and the motivation of employees in the workplace. Our results do not deny, however, the possible instrumental benefits of autonomy (which did not play a role in our design) and their potentially powerful impact on motivation.

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Experiments in Organizational Economics
Type: Book
ISBN: 978-1-78560-964-0

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Book part
Publication date: 18 December 2016

Fu-Wen Hsieh and Joseph Tao-yi Wang

To study strategic information transmission in organizations, we conduct a simplified version (with only three states) of the sender-receiver game experiment designed by…

Abstract

To study strategic information transmission in organizations, we conduct a simplified version (with only three states) of the sender-receiver game experiment designed by Wang, Spezio, and Camerer (2010), in which an informative sender advises an uninformed receiver to take an action (to match the true state), but has incentives to exaggerate. We also have the same subjects play the original five-state game. We find similar “overcommunication” behavior with Taiwanese subjects – messages reveal more information about the true state than what equilibrium predicts – that let us classify subjects into various level-k types. However, results from the simplified version are closer to equilibrium prediction, with more senders robustly classified as level-2.

Details

Experiments in Organizational Economics
Type: Book
ISBN: 978-1-78560-964-0

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Book part
Publication date: 18 December 2016

Hodaka Morita and Maroš Servátka

We study whether group identity mitigates inefficiencies associated with appropriable quasi-rents, which are often created by relationship-specific investments in…

Abstract

We study whether group identity mitigates inefficiencies associated with appropriable quasi-rents, which are often created by relationship-specific investments in bilateral trade relationships. We conjecture that group identity strengthens the effect of an agent’s generous action in increasing his trade partner’s altruistic preferences, and this effect helps reduce incentives to undertake ex-post inefficient opportunistic behavior such as investment in an outside option. Our experimental results, however, do not support this conjecture, and contrast with our previous experimental findings that group identity mitigates distortions in ex-ante efficient relation-specific investment. We discuss a possible cause of the difference and its implications for the theory of the firm.

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Book part
Publication date: 9 December 2013

Philip Mellizo

Group incentive schemes have been shown to be positively associated with firm performance but it remains an open question whether this association can be explained by the…

Abstract

Purpose

Group incentive schemes have been shown to be positively associated with firm performance but it remains an open question whether this association can be explained by the motivating characteristics of the group-incentive scheme itself, or if this is due to factors that tend to accompany group-incentive schemes. We use a controlled experiment to directly test if group-incentive schemes can motivate sustained individual effort in the absence of rules, norms, and institutions that are known to mitigate free-riding behavior.

Design/methodology/approach

We use a controlled lab experiment that randomly assigns subjects to one of three compensation contracts used to incentivize an onerous effort task. Two of the compensation contracts are group-incentive schemes where subjects have an incentive to free-ride on the efforts of their coworkers, and the third (control) is a flat-wage contract.

Findings

We find that both group-incentive schemes resulted in sustained, higher performance relative to the flat-wage compensation contract. Further, we do not find evidence of free-riding behavior under the two group-incentive schemes.

Research limitations/implications

Although we do find sustained cooperation/performance over the three work periods of our experiment under the group-incentive schemes, further testing would be required to evaluate whether group-incentive schemes can sustain cooperation over a longer time horizon without complementary norms, policies, or institutions that mitigate free-riding.

Originality/value

By unambiguously showing that group-incentive schemes can, by themselves, motivate workers to provide sustained levels of effort, this suggests that the “1/n problem” may be, in part, an artifact of the rational-actor modeling conventions.

Details

Sharing Ownership, Profits, and Decision-Making in the 21st Century
Type: Book
ISBN: 978-1-78190-750-4

Keywords

Content available
Article
Publication date: 20 October 2020

Thanh Mai Ha, Shamim Shakur and Kim Hang Pham Do

This paper analyses Hanoi consumers' evaluation of food risk and response to the perceived risk.

Abstract

Purpose

This paper analyses Hanoi consumers' evaluation of food risk and response to the perceived risk.

Design/methodology/approach

The authors employed the mixed method approach that integrates segmentation analysis on the survey data and information from group discussions.

Findings

Based on consumers' risk rating of six food groups and level of food safety worry, the authors identified four distinct consumer segments: low, moderate, high and very-high-risk perception. The authors found the existence of widespread food safety concerns among Hanoi consumers. Living in an urban region was associated with a higher level of food risk perception. Moderate, high and very-high-risk perception segments exhibited a very low level of institutional trust and subjective control over hazards. Response to the perceived risk differed across segments. “Very high-risk perception” was associated with the most risk-averse behaviour, putting more effort into seeking food safety information and engaging more in supermarket purchase. Consumers with a low and moderate perceived food risk participate more in self-supply of food to reduce their food safety concern.

Practical implications

The paper provides empirical evidence on consumers' evaluation of food risk and their risk-reducing strategies to support the risk communication in Vietnam.

Social implications

Enhancing institutional trust and risk communication including hazard education can improve consumer confidence in food.

Originality/value

This is the first segmentation study on consumer food risk perception in Vietnam.

Details

Journal of Asian Business and Economic Studies, vol. 28 no. 2
Type: Research Article
ISSN: 2515-964X

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Article
Publication date: 11 June 2018

Corey Allen Shank

The purpose of this paper is to examine whether business students deceive others more often than non-business students.

Abstract

Purpose

The purpose of this paper is to examine whether business students deceive others more often than non-business students.

Design/methodology/approach

A cheap talk experiment and an ethics questionnaire are employed to examine the subject’s behavior. Fundamental differences, such as psychopathic personality, are used to examine their role in deceptive and unethical behavior.

Findings

The results show that business students deceive others for personal gain more often than non-business students when there is the most to gain; however, business students find deception committed by others as unethical. Business students exhibit more psychopathic tendencies compared to non-business students, including being more likely to fit the prototypical psychopath profile. This fundamental difference in psychopathy can help explain why individuals deceive others and behave unethically.

Practical implications

These results have important implications for the business industry and the design of policies.

Originality/value

Thus, this study endeavors to advance the literature on fundamental distinctions between those who work in high levels of organizations and how this fundamental difference impacts decision making.

Details

Review of Behavioral Finance, vol. 10 no. 2
Type: Research Article
ISSN: 1940-5979

Keywords

Content available
Article
Publication date: 15 August 2018

Jon Reiersen

The purpose of this paper is to contribute to the understanding of why people act trustworthily in anonymous non-repeated meetings where trustworthiness benefits the…

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Abstract

Purpose

The purpose of this paper is to contribute to the understanding of why people act trustworthily in anonymous non-repeated meetings where trustworthiness benefits the trustor and runs against the trustee’s material self-interest.

Design/methodology/approach

The paper uses a survey originally developed by Bicchieri et al. (2011). The survey makes it possible to explore whether trustworthiness has a normative element. Is there a norm of trustworthiness that inflicts punishment for disobedience?

Findings

The participants in the experiment strongly believe that most people will punish untrustworthy behavior, lending support to the idea that trustworthiness is norm driven. The data provide little evidence for a parallel norm of trust.

Originality/value

The theory of repeated games explains how trust can emerge among players in ongoing interactions. But why do people choose to trust others who they do not know in non-ongoing interactions? The results offer an explanation. When trustors are aware that trustworthiness is rooted in norms, they have reason to expect trustees to act trustworthily. Then, it makes sense to trust since trustors will benefit from their trusting.

Details

International Journal of Social Economics, vol. 46 no. 1
Type: Research Article
ISSN: 0306-8293

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Article
Publication date: 5 June 2017

Robson Braga, Luiz Paulo Lopes Fávero and Renata Turola Takamatsu

The purpose of this paper is to evaluate investor behaviour related to the timing of selling financial assets based on an intuitive evaluation of the current market trend…

Abstract

Purpose

The purpose of this paper is to evaluate investor behaviour related to the timing of selling financial assets based on an intuitive evaluation of the current market trend and growth expectation.

Design/methodology/approach

The experiment involved 1,052 volunteer participants who made decisions about stock sales in an environment that simulated a home broker platform to negotiate stocks. Zero-inflated regression models were used.

Findings

The results show that investors’ attitudes, or beliefs, determine whether they will buy or keep risky assets in their investment portfolios; they may decide to sell such assets, even though market shows an upward trend. Such results make a new contribution to behavioural finance within the context of prospect theory and the disposition effect.

Originality/value

The originality of this paper lies in the use of new and innovative techniques (zero-inflated Poisson and negative binomial regression models) applied to real data obtained experimentally.

Propósito

Este artigo estuda o comportamento de investidores relacionado ao momento da venda de ativos financeiros com base em uma avaliação intuitiva da tendência atual do mercado e da expectativa de crescimento.

Desenho/metodologia/abordagem

Nosso experimento envolveu 1,052 participantes voluntários que tomaram decisões sobre a venda de ações em um ambiente que simulava uma plataforma de corretagem para negociação. Foram utilizados modelos de regressão inflacionados de zeros.

Resultados

Os resultados mostram que as atitudes ou crenças dos investidores determinam se eles comprarão ou manterão ativos de risco em suas carteiras de investimento; eles podem decidir vender esses ativos, mesmo que o mercado mostre uma tendência ascendente. Tais resultados constituem uma nova contribuição para o campo das finanças comportamentais, dentro do contexto da teoria do prospecto e do efeito disposição.

Originalidade/valor

A originalidade deste artigo reside no uso de técnicas novas e inovadoras (modelos de regressão Poisson e binomial negativo inflacionados de zeros) aplicadas a dados reais obtidos experimentalmente.

Details

Academia Revista Latinoamericana de Administración, vol. 30 no. 2
Type: Research Article
ISSN: 1012-8255

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Article
Publication date: 1 January 1994

J.E. Rowley

The publication in 1993 of the 1991 Census on CD‐ROM by Chadwyck‐Healey makes the data much more accessible, cheaper and easier to use. The data is available in a variety…

Abstract

The publication in 1993 of the 1991 Census on CD‐ROM by Chadwyck‐Healey makes the data much more accessible, cheaper and easier to use. The data is available in a variety of different formats to suit different user groups. A number of software products are available to assist the user in the exploitation of the Census data. The Census Data on CD‐ROM is particularly likely to be important in public and academic libraries. As with the development of any CD‐ROM based service there are a number of strategic and practical day‐to‐day issues that will need to be addressed.

Details

Aslib Proceedings, vol. 46 no. 1
Type: Research Article
ISSN: 0001-253X

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