Working Papers

Firms in durable good product markets face incentives to intertemporally price discriminate, by setting high initial prices to sell to consumers with the highest willingness to pay, and cutting prices thereafter to appeal to those with lower…

This research examines the temporal range of subliminal priming effects on complex behavior. In Experiments 1 and 2, participants were subliminally primed with words either related or unrelated to intelligence before completing a practice exam,…

This paper presents a positive theory of corporate social responsibility set in a managerial capitalism context in which managers instead of markets allocate resources, including social expenditures. The theory focuses jointly on the operational…

This paper examines the European stock market reaction to key events predicted to affect the adoption of International Financial Reporting Standards (IFRS) in Europe, including adoption of the controversial standard on financial instruments, IAS…

This note revisits the identification theorems of B. Brown (1983) and Roehrig (1988). We describe an error in the proofs of the main identification theorems in these papers, and provide an important counterexample to the theorems on the…

Political economists interested in discerning the effects of election outcomes on the economy have been hampered by the problem that economic outcomes also influence elections. We sidestep these problems by analyzing movements in economic…

This paper provides a theory of firm behavior motivated by moral duty, self-interest, and social pressure. A morally-managed and a self-interested firm compete in a market in which their corporate social performance (CSP) provides product…

Prediction Markets, sometimes referred to as information markets, idea futures or event futures, are markets where participants trade contracts whose payoffs are tied to a future event, thereby yielding prices that can be interpreted as market-…

We discuss the case of a monopolist of a base good in the presence of a complementary good provided either by it or by another firm. We assess and calibrate the extent of the influence of the profits from the base good that is created by the…

We study how the intensity of competition and the degree to which manufacturers enjoy market power depends on the retail environment in a given market. Past research has discussed the growing importance of retailers and the power they enjoy over…

We apply Mertens’ definition of stability for a game in strategic form to a game in extensive form with perfect recall. We prove that if payoffs are generic then the outcomes of stable sets of equilibria defined via homological essentiality by…

Despite its importance, voting in the elections of corporate boards of directors remains relatively unexplored in the empirical literature. We construct a comprehensive dataset of 3,204,890 mutual fund votes in director elections that took place…

A three-stage model isolates conditions under which an executive appointment to a collective choice body, such as a court or a regulatory agency, has an immediate bearing on policy. The model strikes a balance between previous formal models that…

This paper studies the barriers to the diffusion of development across countries over the very long run. We find that genetic distance, a measure associated with the amount of time elapsed since two populations’ last common ancestors, bears a…

We analyze the effect of entry on the technology adoption and calling plan choices of incumbent cellular firms. Focusing on the time period from 1996, when incumbents enjoyed a duopoly market, to 1998, when they faced increased competition from…

A heavily used competitive tactic in the grocery business is the weekly advertising of price reductions in newspaper inserts and store fliers. Store managers commonly believe that advertisements of price reductions and loss leaders help to build…

We propose that the variety a brand offers can influence brand quality perceptions, and consequently, affect brand choice, even when the available option set is held constant. Specifically, brands that offer greater variety of compatible (i.e.,…

Why do successful organizations often move in new directions and then fail? We propose that this pattern is especially likely among organizations that have survived a history of competition. Such experience adapts organizations to their…

Four experiments demonstrate that culture-based differences in persuasion arise when information is processed in a cursory, spontaneous manner, but dissipate when one’s intuitions are supplemented by more deliberative processing. North Americans…

We estimate the costs of broad-based stock option programs relative to cash compensation and restricted stock grants. Using detailed data on stock-option grants to middle managers, we first compute the cost of option grants under the assumption…