567 research outputs found
Entrepreneurial Finance and the Flat-World Hypothesis: Evidence from Crowd-Funding Entrepreneurs in the Arts
We examine the geography of early stage entrepreneurial finance in the
context of an internet marketplace for funding new musical
artist-entrepreneurs. A large body of research documents that investors
in early-stage projects are disproportionately co-located with the
entrepreneur. Theory predicts this will be particularly true of
artist-entrepreneurs with preliminary-stage projects,
difficult-to-contract-for effort, difficult-to-observe creativity,
negligible tangible assets, and limited reputations. At the same time,
however, observers of the spatial effects of the internet and related
technologies report that many economic activities have become much less
geographically dependent. At an aggregate level, the internet
marketplace we examine does indeed demonstrate a spatial transformation
of the entrepreneurial finance process: the average distance between
investors and artist-entrepreneurs is 4,831 km. However, geography still
matters; investors are disproportionately likely to be local and,
conditional on investing, local investors invest more. This apparent
role for proximity is strongest before entrepreneurs visibly accumulate
capital. Within a single round of financing, local investors are more
likely to engage earlier in the funding cycle. However, this difference
in the timing of investment is almost entirely explained by a particular
type of investor, whom we characterize as 'family, friends, and fans.'
We conjecture that these individuals, who are disproportionately
co-located with the entrepreneur, have offline information about the
entrepreneur and therefore derive less new information from observing
the aggregate financing raised. We speculate that the path-dependent
role of this offline network in conveying information to the online
community limits the 'flat world' potential of these communication technologies
Software Exclusivity and the Scope of Indirect Network Effects in the U.S. Home Video Game Market
This paper investigates the scope of indirect network effects in the
home video game industry. We argue that the increasing prevalence of
non-exclusive software gives rise to indirect network effects that exist
between users of competing and incompatible hardware platforms. This is
because software non-exclusivity, like hardware compatibility, allows a
software firm to sell to a market broader than a single platform's
installed base, leading to a dependence of any particular platform's
software on all firms' installed bases. We look for evidence of these
market-wide network effects by estimating a model of hardware demand and
software supply. Our software supply equation allows the supply of games
for a particular platform to depend not only on the installed base of
that platform, but also on the installed base of competing platforms.
Our results indicate the presence of both a platform-specific network
effect and -in recent years- a cross-platform (or generation-wide)
network effect. Our finding that the scope of indirect network effects
in this industry has widened suggests one reason that this market, which
is often cited as a canonical example of one with strong indirect
network effects, is no longer dominated by a single platform
Who thinks about the competition? Managerial ability and strategic entryin US local telephone markets
This paper examines how manager and firm characteristics relate to entry
decisions in US local telephone markets. To do so, it develops a
structural econometric model that allows managers to be heterogeneous in
their ability to correctly conjecture competitor behavior. The model
adapts Camerer, Ho, and Chong's (2004) Cognitive Hierarchy model to a
real-world setting. We observe the industry in 1998, shortly after the
Telecommunications Act of 1996 opened up the market. We find that older
firms with older, more experienced managers have higher estimated levels
of strategic ability. Managers with degrees in economics or business,
and managers with graduate degrees, also have higher estimated levels of
strategic ability. We find no evidence that university quality is
related to ability. We repeat this exercise using data from 2000, 2002,
and 2004. While the core results do not change, the overall level of
measured strategic ability increases substantially by 2004. The
estimates of strategic ability are also correlated with survival: those
firms with lower estimated levels of ability are more likely to exit the
industry early
Patents and the Performance of Voluntary Standard Setting Organizations
This paper measures the technological significance of voluntary standard
setting organizations (SSOs) by examining citations to patents disclosed
in the standard setting process. We find that SSO patents are cited far
more frequently than a set of control patents, and that SSO patents
receive citations for a much longer period of time. Furthermore, we find
a significant correlation between citation and the disclosure of a
patent to an SSO, which may imply a marginal impact of disclosure. These
results provide the first empirical look at patents disclosed to SSOs,
and show that these organizations not only select important
technologies, but may also play a role in establishing their significance
Search Engine Advertising: Pricing Ads to Context
Each search term put into a search engine produces a separate set of
results. Correspondingly, each of the sets of ads displayed alongside
the results is priced using a separate auction. We investigate how bids
for these context-based ads depends on the difficulty of making a match.
This contrasts with the existing literature that focuses on the effect
of match quality. We examine advertising prices paid by lawyers for 139
Google search terms in 195 locations. Other things being equal, the
fewer searches there are on a term, the higher the price. To identify a
causal relationship between match-difficulty and prices paid, we exploit
a natural experiment in 'ambulance-chaser' regulations across states.
When lawyers cannot contact a client by mail and matching becomes more
difficult, the relative price per ad click is $0.93 higher. We check the
robustness of this result by performing a falsification test using a
different ambulance-chaser regulation. Our results suggest that prices
are higher for context-based ads when the difficulty of both online and
off-line matching increases. This highlights that a major reason why
search advertising is profitable is because its use of context can
monetize the 'long tail' by reducing friction in the matching process
External review of IDRC's Food, Environment, and Health (FEH) Program 2015-2020 : final report
This detailed summative evaluation provides evidence and recommendations regarding how to improve effectiveness in IDRC’s Food, Environment and Health (FEH) strategic body of research programming across Latin America and the Caribbean (LAC) countries, as well as Africa, Asia, and the Middle East. Evaluation findings cover: program strategy; strategic issues; programmatic outcomes; and knowledge management, monitoring and evaluation. It is recommended that the IDRC protects program coherence towards enhancing outcomes by reducing the number of thematic aims
What's in a (Missing) Name? Status and Signaling in Open Standards Development
How much are we influenced by an author's identity? If identity matters,
is it because we have a 'taste for status' or because it offers a useful
shortcut — a signal that is correlated with the likely importance
of their ideas? This paper presents evidence from a natural experiment
that took place at the Internet Engineering Task Force (IETF) — a
community of engineers and computer scientists who develop the protocols
used to run the Internet. The results suggest that IETF participants use
authors' identity as a signal or filter, paying more attention to
proposals from highstatus authors, and this has a surprisingly large
impact on publication outcomes. There is little evidence of a 'taste'
for status
A Dyad Model of Calling Behaviour with Tie Strength Dynamics
This paper investigates the dynamic relation between callers' social
ties and their wireless phone service consumption. We construct a large
pair-level panel dataset with information on the number of each pair's
common contacts, calling activities, prices, and each caller's
characteristics over a one-year time period. We estimate a dynamic model
that encapsulates the evolving relationship between each pair of
consumers. We find the amount of communications between a pair of
consumers increases with the strength of their tie, which is higher when
these two consumers share more common contacts. Our results support the
reciprocity rule in telephone calls, i.e. when individual A initiates
more (less) phone calls to individual B in one month, their social tie
will be strengthened (weakened) and individual B will make more (less)
calls to individual A in the subsequent months. We demonstrate the
implications of our results in evaluating the return of temporary price
promotions and designing price plans. Our results underscore the
importance of incorporating social network characteristics in the study
of telecommunications markets
Software Exclusivity and the Scope of Indirect Network Effects in the U.S. Home Video Game Market
This paper investigates the scope of indirect network effects in the
home video game industry. We argue that the increasing prevalence of
non-exclusive software gives rise to indirect network effects that exist
between users of competing and incompatible hardware platforms. This is
because software non-exclusivity, like hardware compatibility, allows a
software firm to sell to a market broader than a single platform's
installed base, leading to a dependence of any particular platform's
software on all firms' installed bases. We look for evidence of these
market-wide network effects by estimating a model of hardware demand and
software supply. Our software supply equation allows the supply of games
for a particular platform to depend not only on the installed base of
that platform, but also on the installed base of competing platforms.
Our results indicate the presence of both a platform-specific network
effect and -in recent years- a cross-platform (or generation-wide)
network effect. Our finding that the scope of indirect network effects
in this industry has widened suggests one reason that this market, which
is often cited as a canonical example of one with strong indirect
network effects, is no longer dominated by a single platform
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