Shaping Consumer Perception to Motivate Online Shopping: A Prospect Theory Perspective

Drawing upon prospect theory, we propose that the framings of a message describing the benefits of online shopping will have different impacts on consumers’ attitude toward and intention of online shopping. Particularly, a negatively framed message emphasizing the costs of losing the benefits is likely to be interpreted by an individual as loss and a positively framed message emphasizing the benefits of online shopping is likely to be interpreted as gain. According to prospect theory, the negatively framed message is more likely to increase one’s intention to shop online than the positively framed message. We also propose that such framing effect is moderated by purchase involvement. This research-in-progress paper presents the rationale behind these propositions, experimental designs to test these propositions, and the expected contributions. We contend that the findings will enhance our understanding about consumers’ online shopping and provide prescriptive knowledge regarding how to change their behavior

The Effect of Initial Water Saturation on Freeze-thaw Damage of Submerged Mortar Materials

An indispensable condition for the occurrence of the freeze-thaw (F-T) damage in unsaturated cement-based materials is that the specimens absorb water during the F-T process and reach a critical level of water saturation, which is influenced by the initial degree of water saturation (IDWS). However, the fast-freeze method commonly used in the laboratory does not reflect the effect of the IDWS on F-T damage. Thus, this study investigated the effect of different IDWS on the development of F-T damage in specimens to fill the gap in this research area. In this study, compressive strength tests were used to characterize the development of damage, while SEM and MIP tests were used to identify the damage at a microscopic level. A reasonable explanation for the damage development was suggested using the critical satiation theory as well as the negative-temperature pumping effect. According to the experimental and discussed results, damage developed more rapidly in specimens with a low IDWS compared to specimens with a high IDWS. The rapid development of damage was not only related to the hydrostatic pressure during the F-T process, but also the osmotic pressure generated during the entry of external water. As the IDWS decreased, the negative-temperature pumping effect of the specimens became more pronounced. Therefore, a lower IDWS led to a higher osmotic pressure caused by the entry of external water and faster development of damage. This, in return, created more water transfer paths and accelerated the process of reaching the critical level of water saturation, significantly weakening the F-T resistance of the specimen

Revisiting Overborrowing and its Policy Implications

This paper analyzes quantitatively the extent to which there is overborrowing (i.e., inefficient borrowing) in a business cycle model for emerging market economies with production and an occasionally binding credit constraint. The main finding of the analysis is that overborrowing is not a robust feature of this class of model economies: it depends on the structure of the economy and its parametrization. Specifcally, underborrowing in a production economy is found with the baseline calibration, but overborrowing with more impatient agents and more volatile shocks. Endowment economies display overborrowing regardless of parameter values, but they do not allow for policy intervention when the constraint binds (in crisis times). Quantitatively, the welfare gains from implementing the constrained¬effcient allocation are always larger near crisis times than in normal ones. In production economies, they are one order of magnitude larger than in endowment economies both in crisis and normal times. This suggests that the scope for economy¬widemacro¬prudential policy interventions (e.g., prudential taxation of capital flows and capital controls) is weak in this class of models.Bailouts, Financial Frictions, Macro Prudential Policies, Overborrowing

Financial Crises and Macro-Prudential Policies

Stochastic general equilibrium models of small open economies with occasionally binding financial frictions are capable of mimicking both the business cycles and the crisis events associated with the sudden stop in access to credit markets (Mendoza, 2010). This paper studies the inefficiencies associated with borrowing decisions in a two-sector small open production economy, finding that this economy is much more likely to display under-borrowing rather than over-borrowing in normal times. As a result, macro-prudential policies (e.g, Tobin taxes or economy-wide controls on capital inflows) are costly in welfare terms. Moreover, macro-prudential policies aimed at minimizing the probability of the crisis event might be welfare-reducing in production economies. The analysis shows that there is a much larger scope for welfare gains from policy interventions during financial crises. That is to say that, ex post or crisis-management policies dominate ex ante or macro-prudential ones.Capital controls, Crises, Financial frictions, Macro-prudential policies, Bailouts, Overborrowing

Revisiting Overborrowing and its Policy Implications

This paper analyzes quantitatively the extent to which there is overborrowing (i.e., inefficient borrowing) in a business cycle model for emerging market economies with production and an occasionally binding credit constraint. The main finding of the analysis is that overborrowing is not a robust feature of this class of model economies: it depends on the structure of the economy and its parametrization. Specifically, we find underborrowing in a production economy with our baseline calibration, but overborrowing with more impatient agents and more volatile shocks. Endowment economies display overborrowing regardless of parameter values, but they do not allow for policy intervention when the constraint binds (in crisis times). Quantitatively, the welfare gains from implementing the constrained efficient allocation are always larger near crisis times than in normal

Network flow optimization and distributed control algorithms

This thesis concerns the problem of designing distributed algorithms for achieving efficient and fair bandwidth allocations in a resource constrained network. This problem is fundamental to the design of transmission protocols for communication networks, since the fluid models of popular protocols such as TCP and Proportional Fair Controller can be viewed as distributed algorithms which solve the network flow optimization problems corresponding to some fairness criteria. Because of the convexity of the optimization problem as well as its decoupling structure, there exist classical dual algorithm and primal/dual algorithm which are both distributed. However, the main difficulty is the possible instability of the dynamics of these algorithms caused by transmission delays. We use customized Lyapunov-Krasovskii functionals to obtain the stability conditions for these algorithms in networks with heterogeneous time-varying delays. There are two main features of our results. The first is that these stability conditions can be enforced by a small amount of information exchange among relevant users and links. The second is that these stability conditions only depend on the upper bound of delays, not on the rate of delay variations. We further our discussion on scalable algorithms with minimum information to maintain stability. We present a design methodology for such algorithms and prove the global stability of our scalable controllers by the use of Zames-Falb multipliers. Next we extend this method to design the first scalable and globally stable algorithm for the joint multipath routing and flow optimization problem. We achieve this by adding additional delays to different paths for all users. Lastly we discuss the joint single path routing and flow optimization problem, which is a NP hard problem. We show bounded price of anarchy for combined flow and routing game for simple networks and show for many-user networks, simple Nash algorithm leads to approximate optimum of the problem

Financial Crises and Macro-Prudential Policies

Stochastic general equilibrium models of small open economies with occasionally binding financial frictions are capable of mimicking both the business cycles and the crisis events associated with the sudden stop in access to credit markets (Mendoza, 2010). In this paper we study the inefficiencies associated with borrowing decisions in a two-sector small open production economy. We find that this economy is much more likely to display "under-borrowing" rather than "over-borrowing" in normal times. As a result, macro-prudential policies (i.e. Tobin taxes or economy-wide controls on capital inflows) are costly in welfare terms in our economy. Moreover, we show that macro-prudential policies aimed at minimizing the probability of the crisis event might be welfare-reducing in production economies. Our analysis shows that there is a much larger scope for welfare gains from policy interventions during financial crises. That is to say that, within our modeling approach, ex post or crisis-management policies dominate ex ante or macro-prudential ones.Capital controls, crises, financial frictions, macro prudential policies, bailouts,overborrowing

From imitation to innovation: A study of China's drug R&D and relevant national policies

Research & Development (R&D) plays an increasingly important role in China's pharmaceutical industry. To gain a competitive edge in the global pharmaceutical market, the current national strategy of China forcefully pushes for independent drug innovations. This article investigates the historical, legal, and institutional contexts in which China's drug R&D has evolved. Based on an analysis of the drug R&D evolution and national policies in China, it predicts the future trend of China's policies relevant to drug innovations. This paper helps to understand the impact of national policies on drug R&D in China, which can be used to inform decision-making on investments in China's pharmaceutical market or conducting technology trade and international cooperation with Chinese partners