Markets
→
- 13 Jun 2018
- Working Paper Summaries
Learning to Become a Taste Expert
How should we learn to discriminate a fine wine or chocolate? Tradition says use a flavor wheel and map the taste into vocabulary. We find that works for novices, but, beyond a point, it is counterproductive. Enthusiasts perform more like experts when they abandon language and just “draw the shape” of the taste.
- 30 May 2018
- Research & Ideas
Should Retailers Match Their Own Prices Online and in Stores?
For multichannel retailers, pricing strategy can be difficult to execute and confusing to shoppers. Research by Elie Ofek and colleagues offers alternative approaches to getting the price right. Open for comment; Comment(s) posted.
- 25 May 2018
- Working Paper Summaries
Trust and Disintermediation: Evidence from an Online Freelance Marketplace
Intermediaries such as brokers, distributors, and agents all face a risk of disintermediation, when two sides circumvent the intermediary and thus avoid the intermediary’s fees. This study of a large online freelance marketplace finds that enhanced user trust increases this risk, alongside other contributing factors like being geographically near one another, having easily divisible jobs, and clients themselves having high ratings.
- 21 May 2018
- Working Paper Summaries
Business, Governments, and Political Risk in South Asia and Latin America Since 1970
This study shows how perceptions of political risk by business leaders in emerging markets have differed between regions. For Latin Americans, macroeconomic and policy turbulence were the biggest sources of risk. For South Asians, excessive bureaucracy was the biggest source of risk. The study is based on a unique Harvard Business School oral history database.
- 07 May 2018
- Research & Ideas
Why Online Retailers Should Hide Their Best Discounts
Online retailers should take a tip from brick-and-mortar shops: Shove your best deals to the back of the store. Research by Thales Teixeira and Donald Ngwe. Open for comment; Comment(s) posted.
- 16 Apr 2018
- Research & Ideas
Can Consumers Be Saved From Their Misguided Decisions?
Even with a world of information at our fingertips, consumers routinely make bad decisions on everything from investments to health coverage. Can science help? Research by Joshua Schwartzstein and Benjamin Handel. Open for comment; Comment(s) posted.
- 31 Mar 2018
- Working Paper Summaries
Expected Stock Returns Worldwide: A Log-Linear Present-Value Approach
Over the last 20 years, shortcomings of classical asset-pricing models have motivated research in developing alternative methods for measuring ex ante expected stock returns. This study evaluates the main paradigms for deriving firm-level expected return proxies (ERPs) and proposes a new framework for estimating them.
- 19 Mar 2018
- Working Paper Summaries
Lone Wolves in Competitive Equilibria
The Lone Wolf Theorem states that any agent who is unmatched in one stable partnership assignment is unmatched in every stable assignment. This new study in matching theory broadens the Lone Wolf Theorem to exchange economies, with implications for the strategy-proof negotiation of job contracts.
- 15 Feb 2018
- Working Paper Summaries
Can Financial Innovation Solve Household Reluctance to Take Risk?
Structured products are an innovative class of retail financial products with option-like features. This paper provides empirical evidence suggesting that innovative financial products like these can help alleviate loss aversion and thus the low participation of households in risky asset markets.
- 04 Feb 2018
- Working Paper Summaries
The Long-Run Dynamics of Electricity Demand: Evidence from Municipal Aggregation
This study provides the first quasi-experimental estimate of the long-run elasticity (responsiveness) of residential electricity demand, and finds that it is about double the short-run elasticity. Our findings highlight the importance of accounting for consumption dynamics when evaluating energy policy.
- 02 Feb 2018
- Working Paper Summaries
Last Place Aversion in Queues
While no one likes standing in line for service, being last intensifies the pain of waiting, doubles the probability of switching queues, and quadruples the chances of leaving the line altogether. Many service settings could be improved if managers actively mitigated last place aversion.
- 30 Jan 2018
- Working Paper Summaries
Credit Supply Shocks, Network Effects, and the Real Economy
Using data for Spain between 2003 and 2013, this study examines firms’ responses to credit supply shocks during times of boom (expansion) and bust (financial crisis and recession). Results indicate that propagation of these shocks through the Spanish production network doubles the magnitude of the real effects typically estimated in the literature. This study also shows how such effects vary greatly during booms and busts.
- 23 Jan 2018
- Working Paper Summaries
Transaction Costs and the Duration of Contracts
When buyers transact with sellers, they select not only whom to transact with but also for how long. This paper develops a model of optimal contract duration arising from underlying supply costs and transaction costs. The model allows for the quantification of transaction costs, which are often unobserved, and the impact of these costs on welfare.
- 06 Dec 2017
- What Do You Think?
Is It Time To Break Up Amazon, Apple, Facebook, or Google?
SUMMING UP Would breaking up tech giants like Facebook and Google be good antitrust policy or bad for capitalism? James Heskett's readers join the conversation. Open for comment; Comment(s) posted.
- 18 Oct 2017
- Research & Ideas
How Economic Clusters Drive Globalization
Historical research by Valeria Giacomin shows that industrial clusters, often cited in explaining local economic growth, have had a much wider impact, especially in developing countries. Open for comment; Comment(s) posted.
- 29 Sep 2017
- Working Paper Summaries
International Business and Emerging Markets: A Long-Run Perspective
This paper examines how strategies by Western multinational enterprises in emerging markets over the last century have been shaped by context. These strategies evolved from resolving logistical challenges to managing assertive governments. More recently the focus has been to locate activities in the lower end of global value chains, whilst responding to local competitors.
- 19 Sep 2017
- Working Paper Summaries
An Invitation to Market Design
Effective market design can improve liquidity, efficiency, and equity in markets. This paper illustrates best practices in market design through three examples: the design of medical residency matching programs, a scrip system to allocate food donations to food banks, and the recent “Incentive Auction” that reallocated wireless spectrum from television broadcasters to telecoms.
- 18 Sep 2017
- Research & Ideas
'Likes' Lead to Nothing—and Other Hard-Learned Lessons of Social Media Marketing
A decade-and-a-half after the dawn of social media marketing, brands are still learning what works and what doesn't with consumers. Open for comment; Comment(s) posted.
- 11 Sep 2017
- Working Paper Summaries
A Historical Approach to Clustering in Emerging Economies
Clusters are geographically concentrated and interlinked agglomerations of specialized firms in a particular domain. This paper argues that long-term studies of clusters in developing countries are necessary to explain the relevance of clusters for the activities of multinational enterprises, making of global business, and building of an integrated marketplace.
That Costs HOW Much?
Beyond the attributes of the product itself, price is probably the leading determinant of success in the marketplace. What does it takes to get the price right? Open for comment; Comment(s) posted.