42 research outputs found

    AI and Procurement

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    Gender Inequality in Research Productivity During the COVID-19 Pandemic

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    Problem definition: We study the disproportionate impact of the lockdown as a result of the COVID-19 outbreak on female and male academic research productivity in social science. Academic/practical relevance: The lockdown has caused substantial disruptions to academic activities, requiring people to work from home. How this disruption affects productivity and the related gender equity is an important operations and societal question. Methodology: We collect data from the largest open-access preprint repository for social science on 41,858 research preprints in 18 disciplines produced by 76,832 authors across 25 countries over a span of two years. We use a difference-in-differences approach leveraging the exogenous pandemic shock. Results: Our results indicate that, in the 10 weeks after the lockdown in the United States, although total research productivity increased by 35%, female academics’ productivity dropped by 13.2% relative to that of male academics. We also show that this intensified productivity gap is more pronounced for assistant professors and for academics in top-ranked universities and is found in six other countries. Managerial implications: Our work points out the fairness issue in productivity caused by the lockdown, a finding that universities will find helpful when evaluating faculty productivity. It also helps organizations realize the potential unintended consequences that can arise from telecommuting. </jats:p

    AI and Procurement

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    Problem definition: In this research, we study how buyers’ use of artificial intelligence (AI) affects suppliers’ price quoting strategies. Specifically, we study the impact of automation—that is, the buyer uses a chatbot to automatically inquire about prices instead of asking in person—and the impact of smartness—that is, the buyer signals the use of a smart AI algorithm in selecting the supplier. Academic/practical relevance: In a world advancing toward AI, we explore how AI creates and delivers value in procurement. AI has two unique abilities: automation and smartness, which are associated with physical machines or software that enable us to operate more efficiently and effectively. Methodology: We collaborate with a trading company to run a field experiment on an online platform in which we compare suppliers’ wholesale price quotes across female, male, and chatbot buyer types under AI and no recommendation conditions. Results: We find that, when not equipped with a smart control, there is price discrimination against chatbot buyers who receive a higher wholesale price quote than human buyers. In fact, without smartness, automation alone receives the highest quoted wholesale price. However, signaling the use of a smart recommendation system can effectively reduce suppliers’ price quote for chatbot buyers. We also show that AI delivers the most value when buyers adopt automation and smartness simultaneously in procurement. Managerial implications: Our results imply that automation is not very valuable when implemented without smartness, which in turn suggests that building smartness is necessary before considering high levels of autonomy. Our study unlocks the optimal steps that buyers could adopt to develop AI in procurement processes. </jats:p

    Disclosing Product Availability in Online Retail

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    Problem definition: Online retailers disclose product availability to influence customer decisions as a form of pressure selling designed to compel customers to rush into a purchase. Can the revelation of this information drive sales and profitability? We study the effect of disclosing product availability on market outcomes—product sales and returns—and identify the contexts where this effect is most powerful. Academic/practical relevance: Increasing sell-out is key for online retailers to remain profitable in the presence of thin margins and complex operations. We provide insights into how their information-disclosure policy—something they can tailor at virtually no cost—can contribute to this important objective. Methodology: We collaborate with an online retailer to procure a year of transaction data on 190,696 products that span 1,290 brands and 472,980 customers. To causally identify our results, we use a generalized difference-in-differences design with matching that exploits one policy of the firm: it discloses product availability only for the last five units. Results: The disclosure of low product availability increases hourly sales—they grow by 13.6%—but these products are more likely to be returned—product return rates increase by 17.0%. Because returns are costly, we also study net sales—product hourly sales minus hourly returns—which increase by 12.5% after the retailer reveals low availability. Managerial implications: The positive effects on sales and profitability amplify over wide assortments and when low-availability signals are abundantly visible and disclosed for deeply discounted products whose sales season is about to end. In addition, we propose a data-driven policy that exploits these results by using machine learning to prescribe the timing of disclosure of scarcity signals in order to boost sales without spiking returns. </jats:p
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