Status-Seeking in Hedonic Games with Heterogeneous Players

We study hedonic games with heterogeneous player types that reflect her nationality, ethnic background, or skill type. Agents' preferences are dictated by status-seeking where status can be either local or global. The two dimensions of status define the two components of a generalized constant elasticity of substitution utility function. In this setting, we characterize the core as a function of the utility's parameter values and show that in all cases the corresponding cores are non-empty. We further discuss the core stable outcomes in terms of their segregating versus integrating properties.Coalitions, Core, Stability, Status-seeking

Happiness, Morality, and Game Theory

Non-cooperative Games, Happiness, Morality.

A Conceptual Model of Investor Behavior

Based on a survey of behavioral finance literature, this paper presents a descriptive model of individual investor behavior in which investment decisions are seen as an iterative process of interactions between the investor and the investment environment. This investment process is influenced by a number of interdependent variables and driven by dual mental systems, the interplay of which contributes to boundedly rational behavior where investors use various heuristics and may exhibit behavioral biases. In the modeling tradition of cognitive science and intelligent systems, the investor is seen as a learning, adapting, and evolving entity that perceives the environment, processes information, acts upon it, and updates his or her internal states. This conceptual model can be used to build stylized representations of (classes of) individual investors, and further studied using the paradigm of agent-based artificial financial markets. By allowing us to implement individual investor behavior, to choose various market mechanisms, and to analyze the obtained asset prices, agent-based models can bridge the gap between the micro level of individual investor behavior and the macro level of aggregate market phenomena. It has been recognized, yet not fully explored, that these models could be used as a tool to generate or test various behavioral hypothesis.behavioral finance;financial decision making;agent-based artificial financial markets;cognitive modeling;investor behavior

Feasibility of applied gaming during interdisciplinary rehabilitation for patients with complex chronic pain and fatigue complaints:A mixed-methods study

Background:  Applied gaming holds potential as a convenient and engaging means for the delivery of behavioral interventions. For developing and evaluating feasible computer-based interventions, policy makers and designers rely on limited knowledge about what causes variation in usage. Objective:  In this study, we looked closely at why and by whom an applied game (LAKA) is demanded and whether it is feasible (with respect to acceptability, demand, practicality, implementation, and efficacy) and devised a complementary intervention during an interdisciplinary rehabilitation program (IRP) for patients with complex chronic pain and fatigue complaints. Methods:  A mixed-methods design was used. Quantitative process analyses and assessments of feasibility were carried out with patients of a Dutch rehabilitation center who received access to LAKA without professional support during a 16-week interdisciplinary outpatient program. The quantitative data included records of routinely collected baseline variables (t0), additional surveys to measure technology acceptance before (t1) and after 8 weeks of access to LAKA (t2), and automatic log files of usage behavior (frequency, length, and progress). Subsequently, semistructured interviews were held with purposively selected patients. Interview codes triangulated and illustrated explanations of usage and supplemented quantitative findings on other feasibility domains. Results:  Of the 410 eligible patients who started an IRP during the study period, 116 patients participated in additional data collections (108 with problematic fatigue and 47 with moderate or severe pain). Qualitative data verified that hedonic motivation was the most important factor for behavioral intentions to use LAKA (P<.001). Moreover, quotes illustrated a positive association between usage intentions (t1) and baseline level (t0) coping by active engagement (Spearman ρ=0.25; P=.008) and why patients who often respond by seeking social support were represented in a group of 71 patients who accessed the game (P=.034). The median behavioral intention to use LAKA was moderately positive and declined over time. Twenty patients played the game from start to finish. Behavioral change content was recognized and seen as potentially helpful by interview respondents who exposed themselves to the content of LAKA. Conclusions:  Variation in the demand for applied gaming is generally explained by perceived enjoyment and effort and by individual differences in coping resources. An applied game can be offered as a feasible complementary intervention for more patients with complex chronic pain or fatigue complaints by embedding and delivering in alignment with patient experiences. Feasibility, effectiveness, and cost-effectiveness can be evaluated in a full-scale evaluation. New observations elicit areas of further research on the usage of computer-based interventions

What are the Effects of Contamination Risks on Commercial and Industrial Properties? Evidence from Baltimore, Maryland

Using the hedonic pricing approach, we investigate how the information released on public registries of contaminated and potentially contaminated sites affects nearby commercial and industrial properties in Baltimore, Maryland. We find that commercial and industrial properties are virtually unaffected by proximity to a site with a history of contamination. Knowing that the site is no longer considered contaminated does not have a rebound effect on property prices either. We also find that urban economic development policies, such as Empowerment Zones and Enterprise Zones, have little effect on property values. In sum, brownfield properties in Baltimore are not particularly attractive investments for developers, and there is little potential for self-sustaining cleanup based on appropriate fiscal incentives, such as Tax Increment Financing. It is doubtful that “one size fits all” measures to encourage the cleanup of contaminated sites can be successful in this context.Contaminated sites registries, Distance to contaminated sites, Hedonic pricing model, Brownfields

An Economic Analysis of Consumer Learning on Entertainment Shopping Websites

Online entertainment shopping, normally supported by the pay-to-bid auction mechanism, represents an innovative business model in e-commerce. Because the unique selling mechanism combines features of shopping and online auction, consumers expect both monetary return and entertainment value from their participation. We propose a dynamic structural model to analyze consumer behaviors on entertainment shopping websites. The model captures the consumer learning process, based both on individual participation experiences and also on observational learning of historical auction information. We estimate the model using a large data set from an online entertainment shopping website. Results show that consumers’ initial participation incentives mainly come from a significant overestimation of the entertainment value and an obvious underestimation of the auction competition. Both types of learning contribute to a general decreasing participation trend among consumers over time. Our model provides both a theoretical explanation and empirical evidence of the consumer churn issue. It further identifies two groups of consumers with different risk characteristics: One group is risk-averse and quits using the website before effective learning takes place, while the other group exhibits risk-seeking behavior and overly commits to the auction games. Based on the estimated parameters of the model, we perform counterfactual analyses to evaluate the effects of policy changes on consumers’ participation behaviors. We discuss several important design implications and recommend strategies for building a sustainable business model in the entertainment shopping industry

A Compensating Differential Approach to Valuing the Social Benefit of Minor League Baseball

This research utilizes a compensating differential framework to measure the social benefits of minor league baseball teams. Consistent with findings at the major league level, individual housing observations from 138 metropolitan areas between 1993 and 2005 show that affiliated teams are associated with a significant 5.7% increase in rents in mid-sized markets ranging from 0.4 to 1.4 million people. On the other hand, independent teams and stadiums are associated with insignificant effects on rents. The positive effect of affiliated minor league teams suggests they are a valuable urban amenity that can contribute to local quality of life

The Economics of Fairness, Reciprocity and Altruism – Experimental Evidence and New Theories

This paper surveys recent experimental and field evidence on the impact of concerns for fairness, reciprocity and altruism on economic decision making. It also reviews some new theoretical attempts to model the observed behavior.Behavioural Economics; Other-regarding Preferences; Fairness; Reciprocity; Altruism; Experiments; Incentives; Contracts; Competition

Strategic and tactical price decisions in hotel revenue management

Dynamic pricing techniques allow using a number of variables in a tactical way compared to standard catalogue prices. This study merges in a conceptual model the relevance of the tactical and the strategic dimension of these variables, classified according to their tangible, reputational or contextual nature. To empirically validate the hypotheses, a database of 21.596 price observations was retrieved from booking.com. The study presents a hedonic price function, using the Shapley-Owen decomposition of the Rsquared to elicit the importance of each group of factors. Further, a hierarchical cluster analysis measures the presence of heterogeneity across operators. The results show that online reputation is gaining importance over the traditional star rating. Despite the tangible variables remain of paramount importance, the findings suggest the relevant role of contextual variables in short-run price variations. The players operating in the tourism and hospitality industries should integrate these findings when designing pricing strategies

The Economics of Fairness, Reciprocity and Altruism – Experimental Evidence and New Theories

Chapter written for the Handbook of Reciprocity, Gift-Giving and AltruismBehavioural Economics; Other-regarding Preferences; Fairness; Reciprocity; Altruism; Experiments; Incentives; Contracts; Competition