...The current issue and full text archive of this journal is available at http://www.emeraldinsight.com/0007-070X.htm BFJ 104,8 670 Results from an experimental auction market Unidad de Economõa Agraria, Servicio de Investigacion   Agroalimentaria ± Gobierno de Aragon, Zaragoza, Spain, and  Dpto Gestion de Empresas ± Universidad Publica de Navarra,   Pamplona, Spain Keywords Organic food, Consumer behaviour, Spain Abstract Organic production and its consumption have grown tremendously in recent years. However, in the case of Spain demand still represents only 1 per cent of food expenditure. The main obstacle seems to be that organic food faces problems related to consumers' acceptability; lack of food availability and seasonality make it difficult to establish appropriate retailing outlets; also, higher costs of production and retailer margins jointly may result in higher prices than consumers are willing to pay for organic food attributes. Research studies have mostly elicited consumers' willingness-to-pay (WTP) for organic food through contingent valuation. Alternatively, explores, using an experimental second-price sealed-bid auction, the value that consumers place on organic food and the effect that information included on ecolabel and physical appearance have on their WTP. This methodological approach involves the use of real money and real products, which, in fact, may overcome the hypothetical bias detected in previous studies. Also discusses the effect on...
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...subsumed by a broader approach based upon the psychology of investors. In this approach, security expected returns are determined by both risk and misvaluation. This survey sketches a framework for understanding decision biases, evaluates the a priori arguments and the capital market evidence bearing on the importance of investor psychology for security prices, and reviews recent models. The best plan is . . . to profit by the folly of others. — Pliny the Elder, from John Bartlett, comp. Familiar Quotations, 9th ed. 1901. IN THE MUDDLED DAYS BEFORE THE RISE of modern finance, some otherwisereputable economists, such as Adam Smith, Irving Fisher, John Maynard Keynes, and Harry Markowitz, thought that individual psychology affects prices.1 What if the creators of asset-pricing theory had followed this thread? Picture a school of sociologists at the University of Chicago proposing the Deficient Markets Hypothesis: that prices inaccurately ref lect all available information. A brilliant Stanford psychologist, call him Bill Blunte, invents the Deranged Anticipation and Perception Model ~or DAPM!, in which proxies for market misvaluation are used to predict security returns. Imagine the euphoria when researchers discovered that these mispricing proxies ~such * Hirshleifer is from the Fisher College of Business, The Ohio State University. This survey was written for presentation at the American Finance Association Annual Meetings in New Orleans, January, 2001. I especially...
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...57876 File ID uvapub:57876 Filename WP11.pdf Version unknown SOURCE (OR PART OF THE FOLLOWING SOURCE): Type report Title Tax evasion and the source of income : an experimental study in Albania and the Netherlands Author(s) K. Gërxhani, A. Schram Faculty UvA: Universiteitsbibliotheek Year 2003 FULL BIBLIOGRAPHIC DETAILS: http://hdl.handle.net/11245/1.427430 Copyright It is not permitted to download or to forward/distribute the text or part of it without the consent of the author(s) and/or copyright holder(s), other than for strictly personal, individual use, unless the work is under an open content licence (like Creative Commons). UvA-DARE is a service provided by the library of the University of Amsterdam (http://dare.uva.nl) (pagedate: 2014-11-27)TAX EVASION AND THE SOURCE OF INCOME: AN EXPERIMENTAL STUDY IN ALBANIA AND THE NETHERLANDS AIAS Working Paper 03/11 May 2003 Dr. Klarita Gërxhani AMSTERDAM INSTITUTE FOR Prof. Dr. Arthur Schram ADVANCED LABOUR STUDIES Universiteit van Amsterdam © Klarita Gërxhani Amsterdam, May 2003 This paper can be downloaded at www.uva-aias.net/files/aias/WP11.pdf Amsterdam Institute for Advanced Labour Studies Tax Evasion and the Source of Income: An Experimental Study in Albania and the Netherlands 5 Tax Evasion and the Source of Income: An Experimental Study in Albania and the Netherlands∗ Abstract A series of experiments among different social groups in both Albania and the Netherlands give the opportunity to...
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...Stephen Leider, Markus M. Möbius, Tanya Rosenblat, Quoc-Anh Do DIRECTED ALTRUISM AND ENFORCED RECIPROCITY IN SOCIAL NETWORKS The Quarterly Journal of Economics, November 2009 Lana Shifrina Groups in Economic Decision-Making Jingjing Zhang 14.05.12 The authors of the paper choose a real world social network (Facebook) to conduct a prosocial behavioral experiment. The motivation behind the experiment is to expand on the previous studies, examining peoplesʼ underlying altruism vs. granting favors in exchange for expected future returns. The authors observe that measuring underlying altruism empirically is quite difficult because people tend to socialize within their social circles and the decisions they make are based on feelings toward individuals within these circles and not on the true nature of the decision maker. In order to overcome these prejudices, the authors believe that this experiment was designed in such a way, that the personal favoritism can be removed and individualsʼ baseline altruism can then be measured. The real world application and the goal of the experiment is to help economists better explain disturbances within systems of informal insurance, provided by social networks, and to predict the necessary measures required to stabilize the system. The paper identifies three natures of prosocial giving: “(1) baseline altruism toward randomly selected strangers, (2) directed altruism that favors friends over random strangers, and (3) giving motivated...
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...American Journal of Experimental Agriculture 4(12): 1680-1696, 2014 SCIENCEDOMAIN international www.sciencedomain.org Market Information and Extent of Agricultural Commercialization: Empirical Evidence from Smallholder Farmers in Effutu Municipality of Ghana Edward Martey1* 1 Savanna Agricultural Research Institute of the Council for Scientific and Industrial Research, P. O. Box TL 52, Tamale, Ghana. Author’s contribution This whole work was carried out by author EM. th Original Research Article Received 26 March 2014 th Accepted 14 May 2014 th Published 29 July 2014 ABSTRACT Aims: Agricultural commercialization literature has shown that access to market information influences market participation by smallholder farmers. However, documentation on which type of access to market information influences the extent of market participation in the study area is missing. Therefore, this paper analyzed the effect of the different types of access to market information on the extent of agricultural commercialization by using data on smallholder maize farmers in the Effutu Municipality of Ghana. Study Design: The study basically used primary data collected through farmer interviews. A structured questionnaire was used to collect information on demographic characteristics, institutional factors, production, marketing and post-harvest activities. Place and Duration of Study: The study was conducted in 15 communities of Effutu Municipality of Ghana between April and May, 2011. Methodology:...
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...Reducing Efficiency through Communication in Competitive Coordination Games* Timothy N. Casona, Roman M. Sheremetab, and Jingjing Zhangc a Department of Economics, Krannert School of Management, Purdue University, 403 W. State St., West Lafayette, IN 47906-2056, U.S.A. b Argyros School of Business and Economics, Chapman University, One University Drive, Orange, CA 92866, U.S.A. c Department of Economics, McMaster University, 1280 Main Street West, Hamilton, ON L8S 4M4, Canada July 30, 2009 Abstract Costless pre-play communication has been found to effectively facilitate coordination and enhance efficiency by increasing individual payoffs in games with Pareto-ranked equilibria. We report an experiment in which two groups compete in a weakest-link contest by expending costly efforts. Allowing group members to communicate before choosing efforts leads to more aggressive competition and greater coordination, but also results in substantially lower payoffs than a control treatment without communication. Our experiment thus provides evidence that communication can reduce efficiency in competitive coordination games. This contrasts sharply with experimental findings from public goods and other coordination games, where communication enhances efficiency and often leads to socially optimal outcomes. JEL Classifications: C71, C72, C91, C92, D72, H41 Keywords: contest, between-group competition, within-group competition, cooperation, coordination, free-riding, experiments Corresponding...
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...© 2002 American Accounting Association Accounting Horizons Vol. 16 No. 3 September 2002 pp. 233–243 COMMENTARY The “Incomplete Revelation Hypothesis” and Financial Reporting Robert J. Bloomfield Robert J. Bloomfield is an Associate Professor at Cornell University. INTRODUCTION The most common form of the Efficient Markets Hypothesis (EMH) states that market prices fully reflect all publicly available information (Fama 1970). The EMH has been highly influential among academics, but practitioners and regulators appear unconvinced. Investors work hard to identify mispriced stocks on the basis of public data, or pay others to do so, even though the EMH asserts that such efforts are wasted. Managers seek to boost stock prices by hiding bad news in footnotes, and regulators work hard to defeat such efforts, even though the EMH asserts that information is reflected in prices no matter how obscure its presentation. Beliefs about inefficiency play a central role in the debate over recognizing expenses for incentive stock options. Opponents of expensing argue that the resulting lower net income will inappropriately reduce market prices, while proponents argue the market does not fully recognize compensation costs reported only in footnotes. In efficient markets, however, expensing these costs has no direct effect on prices, as long as the details of the compensation are included in footnotes. The decision to expense option costs could reduce stock price indirectly, even in efficient...
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...Does Fairness Prevent Market Clearing? An Experimental Investigation Ernst Fehr; Georg Kirchsteiger; Arno Riedl The Quarterly Journal of Economics, Vol. 108, No. 2. (May, 1993), pp. 437-459. Stable URL: http://links.jstor.org/sici?sici=0033-5533%28199305%29108%3A2%3C437%3ADFPMCA%3E2.0.CO%3B2-E The Quarterly Journal of Economics is currently published by The MIT Press. Your use of the JSTOR archive indicates your acceptance of JSTOR's Terms and Conditions of Use, available at http://www.jstor.org/about/terms.html. JSTOR's Terms and Conditions of Use provides, in part, that unless you have obtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the JSTOR archive only for your personal, non-commercial use. Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained at http://www.jstor.org/journals/mitpress.html. Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission. The JSTOR Archive is a trusted digital repository providing for long-term preservation and access to leading academic journals and scholarly literature from around the world. The Archive is supported by libraries, scholarly societies, publishers, and foundations. It is an initiative of JSTOR, a not-for-profit organization with a mission to help the scholarly community take advantage of...
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...Activity 8: Signature Assignment Introduction In this essay, this research study seeks to demonstrates how financial management's usage of IT services reduced cost and control cash flow in the organization. Thus, the organization’s purpose is to analyze the elements which make up the organization’s framework. For that reason, the organization must know all specificy problems, purposes, the significance of the problem, and supporting theories. In fact, this research methodology analyzes the implementation of the problem solutions, and defends the result’s findings Financial management in U.S. firms covers many areas in stocks and cost optimization of the company’s performance management, especially in IT. Many emerging and recent developments in global economies have driven growth which further challenging challenges managers in American companies. The managers have to handle financial issues, especially in this cost drivening economy. However, IT departments are facing the issue of accounting for cost reduction with budget cuts in IT departments. Therefore, the IT departments are facing pressure to cut costs, which will affect education. Financial management focuses on reducing cost, profits, and increasing shareholders value, with IT. IT information is used by the financial managers to meeting the demands of the organization to develop a strategic technology plan. IT managers are put in situations where they are forced to defend their staffing levels against both internal...
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...Quantitative Easing and the American Economy: How Saving is Saving Us From Inflation Mark Nasca „12 Colgate University April 30th, 2012 Abstract Following the Great Recession (2007-09), the Federal Reserve (Fed) utilized monetary policy instruments that had never been used in previous economic recoveries. With interest rates near zero, the Fed undertook rounds of quantitative easing (QE), a non-standard policy, in an attempt to stimulate the economy and help bring the nation out of the recession. In this study, the theoretical model presented by Nasca (2011) will be expanded to show that price level can be stabilized when saving and the money supply increase in tandem, all else constant. Following the theoretical discussion, this study will then utilize an intertemporal model with heterogeneous agents to describe the U.S. economy in order to analyze factors affecting consumer saving decisions when QE policies are enacted following an economic crisis. The goal of this model is to show how the saving decision is affected by the enactment of QE in a crisis environment, given the lower prevailing interest rate scenario and elevated levels of economic instability. This study finds that the increase in saving rate observed in the unfavorable rate environment can potentially be attributed to the increased uncertainty in future income expectations and heightened levels of risk aversion that are characteristic of a post-crisis economy. This serves as a theoretical justification for...
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...The effects of performance on decision making authority Christian Schumacher I. Introduction Authority-- a superior’s legitimate ability to demand obedient behavior from one or more subordinates within a specified realm of actions—is a central feature in human organizations and established as solution to fundamental organizational design challenges within a decision-making framework (e.g. Simon, 1947; Weber, 1922). The problem of the centralization or decentralization of decision rights concerns the locus of the authority to make decisions affecting the organization. (Colombo & Delmastro, 2008) The question of the determinants of the allocation of decision rights in firms has received considerable attention from different streams of economists and strategy scholars over the last couple of decades. The information processing stream ( see Radner & Marschak, 1972; Harris & Raviv, 2002; Sah & Stiglitz, 1986) contends that hierarchical organizations that centralize the decision-making function can suffer from organizational failures, consisting in leaks that arise in transmitting information from the top to the bottom of the hierarchy and vice versa. Benefits of delegation than arise because of inefficiencies in intra-firm communication (Keren, Levhari, & Kerent, 1979) implementation delays (Radner, 1993), fully exploitation of economies arising from local capabilities and specialization tasks (Bolton & Dewatripont, 1994) and high opportunity costs of highrank managers (Harris...
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...thinking, quasimagical thinking, attention anomalies, the availability heuristic, culture and social contagion, and global culture. Theories of human behavior from psychology, sociology, and anthropology have helped motivate much recent empirical research on the behavior of financial markets. In this paper I will survey both some of the most significant theories (for empirical finance) in these other social sciences and the empirical finance literature itself. Particular attention will be paid to the implications of these theories for the efficient markets hypothesis in finance. This is the hypothesis that financial prices efficiently incorporate all public information and that prices can be regarded as optimal estimates of true investment value at all times. The efficient markets hypothesis in turn is based on more primitive notions that people behave rationally, or accurately maximize expected utility, and are able to process all available information. The idea behind the term “efficient markets hypothesis,” a term coined by Harry Roberts (1967),1 has a long history in financial research, a far longer history than the term itself has. The hypothesis (without the words This paper was prepared for John B. Taylor and Michael Woodford, Editors, Handbook of Macroeconomics. An earlier version was presented...
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...between debtholders and stockholders. These relationships are not necessarily harmonious; indeed, agency theory is concerned with so-called agency conflicts, or conflicts of interest between agents and principals. This has implications for, among other things, corporate governance and business ethics. When agency occurs it also tends to give rise to agency costs, which are expenses incurred in order to sustain an effective agency relationship (e.g., offering management performance bonuses to encourage managers to act in the shareholders' interests). Accordingly, agency theory has emerged as a dominant model in the financial economics literature, and is widely discussed in business ethics texts. Agency theory in a formal sense originated in the early 1970s, but the concepts behind it have a long and varied history. Among the influences are property-rights theories, organization economics, contract law, and political philosophy, including the works of Locke and Hobbes. Some noteworthy scholars involved in agency theory's formative period in the 1970s included Armen Alchian, Harold Demsetz, Michael Jensen, William Meckling, and S.A. Ross. CONFLICTS BETWEEN MANAGERS AND SHAREHOLDERS Agency theory raises a fundamental problem in organizationself-interested behavior. A corporation's managers may have personal goals...
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...of solving the majority of frequently occurring problems in a specific applications area. Based on this definition, little or no tangible information is currently available on the practicality of developing hybrid software packages although its benefits are obvious. In mid-1968, EAT's Princeton Computation Center initiated a development project to· determine the feasibility of hybrid applications software. The objectives of the project were to select a frequently occurring 733 application area, develop general purpose software for it, and assess the resultant software based on the above definition, computer economics, ease of use, etc. The objectives of this paper are to present and illustrate the use of the software package developed as a result of the above mentioned project. The chemical kinetic data analysis problem, which is often referred to as the chemical model...
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...Using Econometrics: A Case Study on Reputation Systems Anindya Ghose Panagiotis G. Ipeirotis Arun Sundararajan Department of Information, Operations, and Management Sciences Leonard N. Stern School of Business, New York University {aghose,panos,arun}@stern.nyu.edu Abstract Deriving the polarity and strength of opinions is an important research topic, attracting significant attention over the last few years. In this work, to measure the strength and polarity of an opinion, we consider the economic context in which the opinion is evaluated, instead of using human annotators or linguistic resources. We rely on the fact that text in on-line systems influences the behavior of humans and this effect can be observed using some easy-to-measure economic variables, such as revenues or product prices. By reversing the logic, we infer the semantic orientation and strength of an opinion by tracing the changes in the associated economic variable. In effect, we use econometrics to identify the “economic value of text” and assign a “dollar value” to each opinion phrase, measuring sentiment effectively and without the need for manual labeling. We argue that by interpreting opinions using econometrics, we have the first objective, quantifiable, and contextsensitive evaluation of opinions. We make the discussion concrete by presenting results on the reputation system of Amazon.com. We show that user feedback affects the pricing power of merchants and by measuring their pricing power we can infer...
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