Bid Costs and Endogenous Bid Caps

We study contests where several privately informed agents bid for a price. All bidders bear a cost of bidding that is an increasing function of their bids, and, moreover, bids may be capped. We show that, regardless of the number of bidders, if agents have linear or concave cost functions then setting a bid cap is not profitable for a designer who wishes to maximize the average bid. On the other hand, if agents have convex cost functions (i.e. an increasing marginal cost) then affectively capping the bids is profitable for a designer facing a sufficiently large number of bidders.

All-Pay Auctions with Weakly Risk-Averse Buyers

We use perturbation analysis to study independent private-value all-pay auctions with weakly risk-averse buyers. We show that under weak risk aversion: 1) Buyers with low values bid lower and buyers with high values bid higher than they would bid in the risk neutral case. 2) Buyers with low values bid lower and buyers with high values bid higher than they would bid in a first-price auction. 3) Buyers' expected utilities in an all-pay auction are lower than in a first-price auction. 4) The seller's expected payoff in an all-pay auction may be either higher or lower than in the risk neutral case. 5) The seller's expected payoff in an all-pay auction may be either higher or lower than in a first-price auction.Private-value auctions, Risk aversion, Perturbation analysis

Venture Capital Contracting with Renegotiation

This paper examines contracting between a venture capitalist and an entrepreneur in a setting with unobservable effort when contracts are renegotiated each period. The contribution of our paper lies in the insights it provides on optimal contracts in this setting. The insights from our model prove to be significantly different in certain respects than those obtained under a multi-period contract without renegotiation or a single period setting. An example is worked out to illustrate the division of payoff between the venture capitalist and the entrepreneur each period.

Bid costs and endogenous bid caps

We study contests where several privately informed agents bid for a price. All bidders bear a cost of bidding that is an increasing function of their bids, and, moreover, bids may be capped. We show that, regardless of the number of bidders, if agents have linear or concave cost functions then setting a bid cap is not profitable for a designer who wishes to maximize the average bid. On the other hand, if agents have convex cost functions (i.e. an increasing marginal cost) then affectively capping the bids is profitable for a designer facing a sufficiently large number of bidders

Simultaneous Ad Auctions

We consider a model with two simultaneous VCG ad auctions A and B where each advertiser chooses to participate in a single ad auction. We prove the existence and uniqueness of a symmetric equilibrium in that model. Moreover, when the click rates in A are pointwise higher than those in B, we prove that the expected revenue in A is greater than the expected revenue in B in this equilibrium. In contrast, we show that this revenue ranking does not hold when advertisers can participate in both auctions

An Innovative Influenza Vaccination Policy: Targeting Last Season's Patients

Influenza vaccination is the primary approach to prevent influenza annually. WHO/CDC recommendations prioritize vaccinations mainly on the basis of age and co-morbidities, but have never considered influenza infection history of individuals for vaccination targeting. We evaluated such influenza vaccination policies through small-world contact networks simulations. Further, to verify our findings we analyzed, independently, large-scale empirical data of influenza diagnosis from the two largest Health Maintenance Organizations in Israel, together covering more than 74% of the Israeli population. These longitudinal individual-level data include about nine million cases of influenza diagnosed over a decade. Through contact network epidemiology simulations, we found that individuals previously infected with influenza have a disproportionate probability of being highly connected within networks and transmitting to others. Therefore, we showed that prioritizing those previously infected for vaccination would be more effective than a random vaccination policy in reducing infection. The effectiveness of such a policy is robust over a range of epidemiological assumptions, including cross-reactivity between influenza strains conferring partial protection as high as 55%. Empirically, our analysis of the medical records confirms that in every age group, case definition for influenza, clinical diagnosis, and year tested, patients infected in the year prior had a substantially higher risk of becoming infected in the subsequent year. Accordingly, considering individual infection history in targeting and promoting influenza vaccination is predicted to be a highly effective supplement to the current policy. Our approach can also be generalized for other infectious disease, computer viruses, or ecological networks

The Valuation Implications of Sales Growth in Start-up Ventures

We examine whether and how investors\u27 reliance on financial information is affected by the rate of sales growth of a start-up venture. We find that investors discern between firms by the extent to which their products are adopted by the market. For firms that failed to increased their sales since IPO, investors preceive financial data as not providing relevant or predictive information for investment decision making. In contrast, investors seem to rely heavily on financial information provided by firms presenting a continuous increase in sales. We suggest that investors may perceive firms with a continuous increase (decrease) in sales as those that are (un)able to transfer through the technology adoption lifecycle and make the transition from an early market dominated by a few visionary customers to a mainstream market. Whereas prior studies relate changes in the value-relevance of financial statements to a firm\u27s maturity, as measured on the basis of time (firm age), our findings indicate that the main factor affecting value-relevance is a firm\u27s degree of market penetration

Regulation and Dishonest Behavior: How Controlling Regulatory Mechanisms Prompt Dishonesty in Tax Consulting

We study experimentally how the conflict of interest faced by tax consultants— between telling the truth and pleasing their clients—affects their professional decision-making process, under different levels of scrutiny in the form of an audit. Eighty percent of the experiment’s participants exhibited dishonest behavior. The possibility of being audited by the tax authorities significantly affected the decision-making process of participants when acting dishonestly. While this possibility improved the consulting quality at the beginning of the process, more manipulative efforts followed, leading to an end result similar to that observed in the absence of the risk of an audit. Remarkably, the manip¬ulative efforts increased with the likelihood of an audit

Unveiling Frequency Trends L eading to Information Dissemination

In the modern digital landscape, people\u27s behaviors are influenced by the information they encounter, especially within social networks where passive observers can become active in spreading new ideas (Rafaeli et al. 2004). While Rogers\u27 diffusion of innovation theory (2003) highlights the initial awareness and opinion-forming stages as crucial, there remains a lack of understanding regarding how the frequency of exposure to new concepts affects these stages. This study focuses on the frequency of exposure impacting disseminated information within the Twitter-sphere, examining over 1.2 million tweets from 40,000 users. Frequency indicates the mean daily number of followees\u27 tweets. Our analysis aims to uncover the role of repeated exposure in prompting user participation in spreading information