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This chapter conducts a systematic comparison of behavioral economics’s challenges to the standard accounts of economic behaviors within three dimensions: under risk, over time, and regarding other people. A new perspective on two underlying methodological issues, i.e., inter-disciplinarity and the positive/normative distinction, is proposed by following the entanglement thesis of Hilary Putnam, Vivian Walsh, and Amartya Sen. This thesis holds that facts, values, and conventions have inter-dependent meanings in science which can be understood by scrutinizing formal and ordinary language uses. The goal is to provide a broad and self-contained picture of how behavioral economics is changing the mainstream of economics.

Information and communications technology (ICT) offers enormous opportunities for individuals, businesses and society. The application of ICT is equally important to economic and non-economic activities. Researchers have increasingly focused on the adoption and use of ICT by small and medium enterprises (SMEs) as the economic development of a country is largely dependent on them. Following the success of ICT utilisation in SMEs in developed countries, many developing countries are looking to utilise the potential of the technology to develop SMEs. Past studies have shown that the contribution of ICT to the performance of SMEs is not clear and certain. Thus, it is crucial to determine the effectiveness of ICT in generating firm performance since this has implications for SMEs’ expenditure on the technology. This research examines the diffusion of ICT among SMEs with respect to the typical stages from innovation adoption to post-adoption, by analysing the actual usage of ICT and value creation. The mediating effects of integration and utilisation on SME performance are also studied. Grounded in the innovation diffusion literature, institutional theory and resource-based theory, this study has developed a comprehensive integrated research model focused on the research objectives. Following a positivist research paradigm, this study employs a mixed-method research approach. A preliminary conceptual framework is developed through an extensive literature review and is refined by results from an in-depth field study. During the field study, a total of 11 SME owners or decision-makers were interviewed. The recorded interviews were transcribed and analysed using NVivo 10 to refine the model to develop the research hypotheses. The final research model is composed of 30 first-order and five higher-order constructs which involve both reflective and formative measures. Partial least squares-based structural equation modelling (PLS-SEM) is employed to test the theoretical model with a cross-sectional data set of 282 SMEs in Bangladesh. Survey data were collected using a structured questionnaire issued to SMEs selected by applying a stratified random sampling technique. The structural equation modelling utilises a two-step procedure of data analysis. Prior to estimating the structural model, the measurement model is examined for construct validity of the study variables (i.e. convergent and discriminant validity).

The estimates show cognitive evaluation as an important antecedent for expectation which is shaped primarily by the entrepreneurs’ beliefs (perception) and also influenced by the owners’ innovativeness and culture. Culture further influences expectation. The study finds that facilitating condition, environmental pressure and country readiness are important antecedents of expectation and ICT use. The results also reveal that integration and the degree of ICT utilisation significantly affect SMEs’ performance. Surprisingly, the findings do not reveal any significant impact of ICT usage on performance which apparently suggests the possibility of the ICT productivity paradox. However, the analysis finally proves the non-existence of the paradox by demonstrating the mediating role of ICT integration and degree of utilisation explain the influence of information technology (IT) usage on firm performance which is consistent with the resource-based theory. The results suggest that the use of ICT can enhance SMEs’ performance if the technology is integrated and properly utilised. SME owners or managers, interested stakeholders and policy makers may follow the study’s outcomes and focus on ICT integration and degree of utilisation with a view to attaining superior organisational performance.

This study urges concerned business enterprises and government to look at the environmental and cultural factors with a view to achieving ICT usage success in terms of enhanced firm performance. In particular, improving organisational practices and procedures by eliminating the traditional power distance inside organisations and implementing necessary rules and regulations are important actions for managing environmental and cultural uncertainties. The application of a Bengali user interface may help to ensure the productivity of ICT use by SMEs in Bangladesh. Establishing a favourable national technology infrastructure and legal environment may contribute positively to improving the overall situation. This study also suggests some changes and modifications in the country’s existing policies and strategies. The government and policy makers should undertake mass promotional programs to disseminate information about the various uses of computers and their contribution in developing better organisational performance. Organising specialised training programs for SME capacity building may succeed in attaining the motivation for SMEs to use ICT. Ensuring easy access to the technology by providing loans, grants and subsidies is important. Various stakeholders, partners and related organisations should come forward to support government policies and priorities in order to ensure the productive use of ICT among SMEs which finally will help to foster Bangladesh’s economic development.

This chapter explores a descriptive theory of multidimensional travel behaviour, estimation of quantitative models, and demonstration in an agent-based microsimulation.

A descriptive theory on multidimensional travel behaviour is conceptualised. It theorizes multidimensional knowledge updating, search start/stopping criteria, and search/decision heuristics. These components are formulated or empirically modelled and integrated in a unified and coherent approach.

The theory is supported by empirical observations and the derived quantitative models are tested by an agent-based simulation on a demonstration network.

Based on artificially intelligent agents, learning and search theory, and bounded rationality, this chapter makes an effort to embed a sound theoretical foundation for the computational process approach and agent-based microsimulations. A pertinent new theory is proposed with experimental observations and estimations to demonstrate agents with systematic deviations from the rationality paradigm. Procedural and multidimensional decision-making are modelled. The numerical experiment highlights the capabilities of the proposed theory in estimating rich behavioural dynamics.

The concept and practice of e-services has become essential in business transactions. Yet there are still many organizations that have not developed e-services optimally. This is especially relevant in the context of Indonesian Airline companies. Therefore, many airline customers in Indonesia are still in doubt about it, or even do not use it. To fill this gap, this study attempts to develop a model for e-services adoption and empirically examines the factors influencing the airlines customers in Indonesia in using e-services offered by the Indonesian airline companies. Taking six Indonesian airline companies as a case example, the study investigated the antecedents of e-services usage of Indonesian airlines. This study further examined the impacts of motivation on customers in using e-services in the Indonesian context. Another important aim of this study was to investigate how ages, experiences and geographical areas moderate effects of e-services usage.

The study adopts a positivist research paradigm with a two-phase sequential mixed method design involving qualitative and quantitative approaches. An initial research model was first developed based on an extensive literature review, by combining acceptance and use of information technology theories, expectancy theory and the inter-organizational system motivation models. A qualitative field study via semi-structured interviews was then conducted to explore the present state among 15 respondents. The results of the interviews were analysed using content analysis yielding the final model of e-services usage. Eighteen antecedent factors hypotheses and three moderating factors hypotheses and 52-item questionnaire were developed. A focus group discussion of five respondents and a pilot study of 59 respondents resulted in final version of the questionnaire.

In the second phase, the main survey was conducted nationally to collect the research data among Indonesian airline customers who had already used Indonesian airline e-services. A total of 819 valid questionnaires were obtained. The data was then analysed using a partial least square (PLS) based structural equation modelling (SEM) technique to produce the contributions of links in the e-services model (22% of all the variances in e-services usage, 37.8% in intention to use, 46.6% in motivation, 39.2% in outcome expectancy, and 37.7% in effort expectancy). Meanwhile, path coefficients and t-values demonstrated various different influences of antecedent factors towards e-services usage. Additionally, a multi-group analysis based on PLS is employed with mixed results. In the final findings, 14 hypotheses were supported and 7 hypotheses were not supported.

The major findings of this study have confirmed that motivation has the strongest contribution in e-services usage. In addition, motivation affects e-services usage both directly and indirectly through intention-to-use. This study provides contributions to the existing knowledge of e-services models, and practical applications of IT usage. Most importantly, an understanding of antecedents of e-services adoption will provide guidelines for stakeholders in developing better e-services and strategies in order to promote and encourage more customers to use e-services. Finally, the accomplishment of this study can be expanded through possible adaptations in other industries and other geographical contexts.

Constructing and evaluating behavioral science models is a complex process. Decisions must be made about which variables to include, which variables are related to each other, the functional forms of the relationships, and so on. The last 10 years have seen a substantial extension of the range of statistical tools available for use in the construction process. The progress in tool development has been accompanied by the publication of handbooks that introduce the methods in general terms (Arminger et al., 1995; Tinsley & Brown, 2000a). Each chapter in these handbooks cites a wide range of books and articles on specific analysis topics.

Unfortunately, the answers given are thoroughly embedded in the physics-inspired view of the financial economy as a stable and an equilibrium seeking system. In such a view, if some changes do occur in the financial markets, those changes present no discontinuities and the model has ample time to react by slowly adjusting risk forecasts as the volatility rises. As almost everybody in the world by now knows, currently accepted risk models have time and again shown their inability to deal with financial market reality. Frequent talk of ‘hundred year floods’ and ‘rise in correlations’ not only suggests frequent failures of a theory, but also the inability of the theory to learn from past mistakes by incorporating new data. The crash of 2008, completely unforeseen by all traditional risk systems, should serve as the final wake-up call to re-examine the foundations of the old paradigm and consider how sound they really are.

In this chapter we examine some possibilities of using computer simulation methods to model the interaction of affect and cognition in organizations, with a particular focus on agent-based modeling (ABM) techniques. Our chapter has two main aims. First, we take stock of methodological progress in this area, highlighting important developments in the modeling of affect and cognition in other fields, including psychology and economics. Second, we outline how ABM in particular can help to advance managerial and organizational cognition by building and testing theoretical models predicated on the interaction of affect and cognition. We argue that using ABM for this purpose can improve the level of specificity of cognitive and affective concepts and their interrelationships in organizational theories, yield more behaviorally plausible models of behavior in and of organizations, and deepen understanding of the generative behavioral mechanisms of multi-level organizational phenomena. We highlight possibilities for using ABM to model affect–cognition interactions in studies of mental models, collective cognition, diversity in work groups and teams, and organizational decision-making.

Smart card-based E-payment systems are receiving increasing attention as the number of implementations is witnessed on the rise globally. Understanding of user adoption behavior of E-payment systems that employ smart card technology becomes a research area that is of particular value and interest to both IS researchers and professionals. However, research interest focuses mostly on why a smart card-based E-payment system results in a failure or how the system could have grown into a success. This signals the fact that researchers have not had much opportunity to critically review a smart card-based E-payment system that has gained wide support and overcome the hurdle of critical mass adoption. The Octopus in Hong Kong has provided a rare opportunity for investigating smart card-based E-payment system because of its unprecedented success. This research seeks to thoroughly analyze the Octopus from technology adoption behavior perspectives.

Cultural impacts on adoption behavior are one of the key areas that this research posits to investigate. Since the present research is conducted in Hong Kong where a majority of population is Chinese ethnicity and yet is westernized in a number of aspects, assuming that users in Hong Kong are characterized by eastern or western culture is less useful. Explicit cultural characteristics at individual level are tapped into here instead of applying generalization of cultural beliefs to users to more accurately reflect cultural bias. In this vein, the technology acceptance model (TAM) is adapted, extended, and tested for its applicability cross-culturally in Hong Kong on the Octopus. Four cultural dimensions developed by Hofstede are included in this study, namely uncertainty avoidance, masculinity, individualism, and Confucian Dynamism (long-term orientation), to explore their influence on usage behavior through the mediation of perceived usefulness.

TAM is also integrated with the innovation diffusion theory (IDT) to borrow two constructs in relation to innovative characteristics, namely relative advantage and compatibility, in order to enhance the explanatory power of the proposed research model. Besides, the normative accountability of the research model is strengthened by embracing two social influences, namely subjective norm and image. As the last antecedent to perceived usefulness, prior experience serves to bring in the time variation factor to allow level of prior experience to exert both direct and moderating effects on perceived usefulness.

The resulting research model is analyzed by partial least squares (PLS)-based Structural Equation Modeling (SEM) approach. The research findings reveal that all cultural dimensions demonstrate direct effect on perceived usefulness though the influence of uncertainty avoidance is found marginally significant. Other constructs on innovative characteristics and social influences are validated to be significant as hypothesized. Prior experience does indeed significantly moderate the two influences that perceived usefulness receives from relative advantage and compatibility, respectively. The research model has demonstrated convincing explanatory power and so may be employed for further studies in other contexts. In particular, cultural effects play a key role in contributing to the uniqueness of the model, enabling it to be an effective tool to help critically understand increasingly internationalized IS system development and implementation efforts. This research also suggests several practical implications in view of the findings that could better inform managerial decisions for designing, implementing, or promoting smart card-based E-payment system.

Employees today face a number of threats to their work and financial well-being (i.e., economic stress). In an aim to provide an agenda and theoretical framework for research on multilevel outcomes of economic stress, the current chapter considers how employees’ economic stress gives rise to emergent outcomes and how these emergent outcomes feed back to influence well-being. Specifically, we draw from Conservation of Resources theory to integrate competing theoretical perspectives with regard to employees’ behavioral responses to economic stress. As employees’ behaviors influence those with whom they interact, we propose that behavioral responses to economic stress have implications for group-level well-being (e.g., interpersonal climate, cohesion) and group-level economic stress. In turn, group-level and individual-level behavioral outcomes influence well-being and economic stress in a multilevel resource loss cycle. We discuss potential opportunities and challenges associated with testing this model as well as how it could be used to examine higher-level emergent effects (e.g., at the organizational level).