3,008 research outputs found
We should totally open a restaurant: How optimism and overconfidence affects beliefs
No full textWishful thinking, defined as the tendency to over-estimate the probability of high-payoff outcomes, is a widely-documented phenomenon that can affect decision-making across numerous domains, including finance, management, and entrepreneurship. We design an experiment to distinguish and test the relationship between two easily-confounded biases, optimism and overconfidence, both of which can contribute to wishful thinking. We find that optimism and overconfidence are positively correlated at the individual level and that both help to explain wishful thinking. These findings suggest that ignoring optimism results in an upwardly biased estimate of the role of overconfidence in explaining wishful thinking. To illustrate this point, we show that 30% of our observations are misclassified as under- or overconfident if optimism is omitted from the analysis. Our findings have potential implications for the design of information interventions since how agents incorporate information depends on whether the bias is ego-related
Giving begets giving: Positive path dependence as moral consistency
No full textWe design an experiment to ask whether morally-motivated behavior, e.g., charitable giving, is history-dependent. Using a popular policy nudge, the default option, we exogenously vary altruistic behavior “now” and show that charitable giving “now” causes a 66%- 200% increase in the probability of giving “later”; that is, giving begets giving. We further show that, consistent with psychological theory, the choice to behave altruistically “now”, rather than the nudge itself, is the crucial element in the causal relationship. These findings are consistent with a model of positive path-dependence, which we interpret as moral consistency
Stephanie Mathson interviews poet and author Judith Kerman
No full textPoet and author Judith Kerman talks about her experience as a Fulbright scholar in the Dominican Republic, her work translating poems by Cuban poet Dulce Mar\ueda Loynaz, learning Spanish, translating poems from Spanish, and her book "Retrofitting Blade Runner". Kerman is interviewed by Stephanie Mathson of the Michigan State University Libraries. Part of the MSU Libraries' Michigan Writers Series
Stephanie Mathson interviews poet and author Jack Ridl
No full textPoet and author Jack Ridl explains how he began writing, the writer series at Hope College, his coach poems, his chapbook "Against elegies," how working and living in Michigan shapes his work, and works in progress. Ridl is interviewed by Stephanie Mathson of the Michigan State University Libraries. Part of the MSU Libraries' Michigan Writers Series
Stephanie Mathson interviews poet and author Josie Kearns
No full textPoet and author Josie Kearns, professor of creative writing and literature at the University of Michigan, talks about teaching and writing, natural scenery in Michigan, her editorship of the book "New Poems From the Third Coast", her book "New Numbers", and other works in process. Kearns is interviewed by Stephanie Mathson from the Michigan State University Libraries for the MSU Libraries' Michigan Writers Series
Kara Gust interviews author and bioregionalist Stephanie Mills
No full textAuthor and ecologist Stephanie Mills talks about how she started writing and publishing, writing on nature and the environment, the challenges of being a writer, the influence of Michigan on her work, bio-regionalism, and a new book she is working on. Mills is interviewed by Michigan State University Librarian Kara Gust for the Michigan State University Libraries' Michigan Writers Series
Altruism or diminishing marginal utility?
No full textWe challenge a commonly used assumption in the literature on social preferences and show that this assumption leads to significantly biased estimates of the social preference parameter. Using Monte Carlo simulations, we demonstrate that the literature’s common restrictions on the curvature of the decision-makers utility function can dramatically bias the altruism parameter. We show that this is particularly problematic when comparing altruism between groups with well-documented differences in risk aversion or diminishing marginal utility, i.e., men versus women, giving motivated by pure versus warm glow motives, and wealthy versus poor. We conclude by proposing two approaches to address this bias
Altruism among consumers as donors
No full textLike most charitable and non-profit organizations, the arts, cultural institutions and universities often ask individuals for financial gifts to help fund their operations. However, a key difference is that the individuals who are solicited for charitable donations by arts and cultural institutions are oftentimes also purchasing services from the same institution. Thus, an open question is whether, and how, individuals make trade-offs between charitable gifts and consumer purchases from the same institution. We investigate this question in an online experiment that asks Sydneysiders to make a series of decisions between donating to the iconic Sydney Opera House, purchasing merchandise from the Sydney Opera House and keeping money. Our findings show that demand for SOH merchandise and SOH donations are substitutes. Further, we find evidence that increasing the individuals’ awareness of the substitutability between money received from donations and money received from the sale of merchandise, increases the cross-price elasticity. This is particularly true for those individuals who positively identify with the Opera House. Our results suggest that the unique nature of arts, cultural and educational institutions as recipients of donations and providers of services mean that fundraising among “patrons” may crowd-in additional revenue
Making a market for Miscanthus: Can new contract designs solve the biofuel investment hold-up problem?
No full textWe present designs for optimal contracts to solve the investment hold-up problem for perennial crops for the biofuel industry. A fixed-price contract is ex-ante efficient but renegotiation-proof for a limited range of discount parameters. A perfectly- indexed contract is both renegotiation-proof and ex-post efficient. Provided long-run land prices are stationary, the expected cost for both contracts converges to the long-run expected price of land for a risk-neutral farmer.Biofuels, Miscanthus, contract theory, industrial organization, renegotiation-proof contract, Marketing,
Waiting to give: Revealed versus stated preferences
No full textWe estimate and compare the effect of increased time costs on consumer satisfaction and behavior. We are able to move beyond the existing literature, which focuses on satisfaction and intention, and estimate the effect of waiting time on return behavior. Further, we do so in a prosocial context and our measure of cost is the length of time a blood donor spends waiting. We find that relying on satisfaction data masks important time cost sensitivities; namely, it is not how the donor feels about the wait time that matters for return behavior, but rather the actual duration of the wait. Consistent with theory we develop, our results indicate that waiting has a significant longer-term social cost: we estimate that a 38% increase (equivalent to one standard deviation) in the average wait would result in a 10% decrease in donations per year
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