Optimal pricing using online auction experiments: A P\'olya tree approach

We show how a retailer can estimate the optimal price of a new product using observed transaction prices from online second-price auction experiments. For this purpose we propose a Bayesian P\'olya tree approach which, given the limited nature of the data, requires a specially tailored implementation. Avoiding the need for a priori parametric assumptions, the P\'olya tree approach allows for flexible inference of the valuation distribution, leading to more robust estimation of optimal price than competing parametric approaches. In collaboration with an online jewelry retailer, we illustrate how our methodology can be combined with managerial prior knowledge to estimate the profit maximizing price of a new jewelry product.Comment: Published in at http://dx.doi.org/10.1214/11-AOAS503 the Annals of Applied Statistics (http://www.imstat.org/aoas/) by the Institute of Mathematical Statistics (http://www.imstat.org

Transitivity, Time Consumption, and Quality of Preference Judgments in Crowdsourcing

Preference judgments have been demonstrated as a better alternative to graded judgments to assess the relevance of documents relative to queries. Existing work has verified transitivity among preference judgments when collected from trained judges, which reduced the number of judgments dramatically. Moreover, strict preference judgments and weak preference judgments, where the latter additionally allow judges to state that two documents are equally relevant for a given query, are both widely used in literature. However, whether transitivity still holds when collected from crowdsourcing, i.e., whether the two kinds of preference judgments behave similarly remains unclear. In this work, we collect judgments from multiple judges using a crowdsourcing platform and aggregate them to compare the two kinds of preference judgments in terms of transitivity, time consumption, and quality. That is, we look into whether aggregated judgments are transitive, how long it takes judges to make them, and whether judges agree with each other and with judgments from TREC. Our key findings are that only strict preference judgments are transitive. Meanwhile, weak preference judgments behave differently in terms of transitivity, time consumption, as well as of quality of judgment

Lessons from Post-colonial Malaysian Economic Development

Malaysian economic development has been shaped by public policy in response to changing national and external conditions. Public investments peaked in the 1970s and early 1980s, until the policy reversals driven by sovereign debt concerns and new policy ideology fads. Foreign investments continued to be favoured after independence for ethnic political reasons. Thus, foreign investments continued to be very significant in financial services as well as manufacturing growth, both for import substitution from the 1960s and for export from the 1970s. Private investments were attracted by government provision of infrastructure, cheap but schooled labour, tax incentives, lax environmental regulations and an undervalued currency. Poverty reduction and ownership redistribution by ethnicity were most successful during the 1970s and early 1980s, although it is unclear how much these improved inter-ethnic relations. Economic liberalization and the growing influence of business interests and political elites have undermined the government’s developmental role, culminating in the 1997–8 financial crisis and lacklustre growth since. Malaysian industrialization could only have been achieved with appropriate incentives for investments and technical progress through key policy interventions.Malaysia, development strategies, liberalization, intervention