We study the effect of peer influence on products that exhibit positive network externalities to non-adopters, i.e., products that benefit adopters' friends even if they do not adopt. Contrary to products that exhibit positive network externalities upon adoption, this structure of incentives likely results in negative peer influence: the more friends that adopted the product, the smaller the incentives to adopt. We measure this effect empirically by using observational data from a large mobile carrier serving 5.7 million users. We estimate the effect of peer influence across five different products of this type. A naive approach to do so results in a positive estimate for peer influence due to unobserved homophily. We follow two approaches to address this issue. First, we suggest using the number of friends that end up adopting the product as a proxy for unobserved user fixed effects. Second, we control for homophily by applying a shuffle test, i.e., we compare the effect of peer influence from the original data with the effect obtained from comparable randomly generated data without peer influence. We get negative estimates from both approaches, which provides robustness to our findings. Finally, we show that even for these products, the effect of peer influence associated with the first friends that adopt the product is positive, which arises because they still convey useful information about reducing uncertainty. The negative effect of peer influence arises only for the subsequent friends that adopt the product. These friends are unlikely to convey new information about the product, but each of them decreases the economic incentive to adopt, resulting in a negative aggregate effect of peer influence.
{"title":"Free-Riding in Products with Positive Network Externalities: Empirical Evidence from a Large Mobile Network","authors":"Rodrigo Belo, Pedro Ferreira","doi":"10.31235/osf.io/wz4k9","DOIUrl":"https://doi.org/10.31235/osf.io/wz4k9","url":null,"abstract":"We study the effect of peer influence on products that exhibit positive network externalities to non-adopters, i.e., products that benefit adopters' friends even if they do not adopt. Contrary to products that exhibit positive network externalities upon adoption, this structure of incentives likely results in negative peer influence: the more friends that adopted the product, the smaller the incentives to adopt. We measure this effect empirically by using observational data from a large mobile carrier serving 5.7 million users. We estimate the effect of peer influence across five different products of this type. A naive approach to do so results in a positive estimate for peer influence due to unobserved homophily. We follow two approaches to address this issue. First, we suggest using the number of friends that end up adopting the product as a proxy for unobserved user fixed effects. Second, we control for homophily by applying a shuffle test, i.e., we compare the effect of peer influence from the original data with the effect obtained from comparable randomly generated data without peer influence. We get negative estimates from both approaches, which provides robustness to our findings. Finally, we show that even for these products, the effect of peer influence associated with the first friends that adopt the product is positive, which arises because they still convey useful information about reducing uncertainty. The negative effect of peer influence arises only for the subsequent friends that adopt the product. These friends are unlikely to convey new information about the product, but each of them decreases the economic incentive to adopt, resulting in a negative aggregate effect of peer influence.","PeriodicalId":18743,"journal":{"name":"MIS Q.","volume":"39 1","pages":"401-430"},"PeriodicalIF":0.0,"publicationDate":"2021-02-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87080074","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-01-15DOI: 10.25300/MISQ/2021/15864
Ping Wang
The remarkable connectivity and embeddedness of digital technologies enable innovations undertaken by a broad set of actors, often beyond organizational and industry boundaries, whose relationships mimic those of interdependent species in a natural ecosystem. These digital innovation ecosystems, if successful, can spawn countless innovations of substantial social and economic value, but are complex and prone to often surprising failure. Aiming to understand ecosystems as a new organizational form for digital innovations, I develop a theory that addresses an underexplored but important question: In a digital innovation ecosystem, how are the efforts of autonomous parties integrated into a coherent whole and what role do digital technologies play in this integration? By synthesizing ecological and information perspectives, this information ecology theory identifies several key functions that digital technologies serve in providing the information needed to support the interactions and tasks for innovation in ecosystems of varying scales. This theory contributes to digital innovation research new insights on managing part–whole relations, the role of digital technologies in innovation, and multilevel interactions in and across digital innovation ecosystems. The theory can also inspire the development of next-generation information systems for ecosystems as a new organizational form.
{"title":"Connecting the Parts with the Whole: Toward an Information Ecology Theory of Digital Innovation Ecosystems","authors":"Ping Wang","doi":"10.25300/MISQ/2021/15864","DOIUrl":"https://doi.org/10.25300/MISQ/2021/15864","url":null,"abstract":"The remarkable connectivity and embeddedness of digital technologies enable innovations undertaken by a broad set of actors, often beyond organizational and industry boundaries, whose relationships mimic those of interdependent species in a natural ecosystem. These digital innovation ecosystems, if successful, can spawn countless innovations of substantial social and economic value, but are complex and prone to often surprising failure. Aiming to understand ecosystems as a new organizational form for digital innovations, I develop a theory that addresses an underexplored but important question: In a digital innovation ecosystem, how are the efforts of autonomous parties integrated into a coherent whole and what role do digital technologies play in this integration? By synthesizing ecological and information perspectives, this information ecology theory identifies several key functions that digital technologies serve in providing the information needed to support the interactions and tasks for innovation in ecosystems of varying scales. This theory contributes to digital innovation research new insights on managing part–whole relations, the role of digital technologies in innovation, and multilevel interactions in and across digital innovation ecosystems. The theory can also inspire the development of next-generation information systems for ecosystems as a new organizational form.","PeriodicalId":18743,"journal":{"name":"MIS Q.","volume":"40 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"77974460","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-01-15DOI: 10.25300/MISQ/2021/15941
D. Leidner, Olgerta Tona
With the rapidly evolving permeation of digital technologies into everyday human life, we are witnessing an era of personal data digitalization. Personal data digitalization refers to the sociotechnical encounters associated with the digitization of personal data for use in digital technologies. Personal data digitalization is being applied to central attributes of human life—health, cognition, and emotion—with the purported aim of helping individuals live longer, healthier lives endowed with the requisite cognition and emotion for responding to life situations and other people in a manner that enables human flourishing. A concern taking hold in manifold fields ranging from IT, bioethics, and law, to philosophy and religion is that as personal data digitalization permeates ever more areas of human existence, humans risk becoming artifacts of technology production. This concern brings to center stage the very notion of what it means to be human, a notion encapsulated in the term human dignity, which broadly refers to the recognition that human beings possess intrinsic value and, as such, are endowed with certain rights and should be treated with respect. In this paper, we identify, describe, and transform what we know about personal data digitalization into a higher order theoretical structure around the concept of human dignity. The result of our analysis is the CARE (claims, affronts, response, equilibrium) theory of dignity amid personal data digitalization, a theory that explains the relationship of personal data digitalization to human dignity. Building upon the CARE theory as a foundation, researchers in a variety of IS research streams could develop mid-range theories for empirical testing or could use the CARE theory as an overarching lens for interpreting emerging IS phenomena. Practitioners and government agencies can also use the CARE theory to understand the opportunities and risks of personal data digitalization and to develop policies and systems that respect the dignity of employees and citizens.
{"title":"The CARE Theory of Dignity Amid Personal Data Digitalization","authors":"D. Leidner, Olgerta Tona","doi":"10.25300/MISQ/2021/15941","DOIUrl":"https://doi.org/10.25300/MISQ/2021/15941","url":null,"abstract":"With the rapidly evolving permeation of digital technologies into everyday human life, we are witnessing an era of personal data digitalization. Personal data digitalization refers to the sociotechnical encounters associated with the digitization of personal data for use in digital technologies. Personal data digitalization is being applied to central attributes of human life—health, cognition, and emotion—with the purported aim of helping individuals live longer, healthier lives endowed with the requisite cognition and emotion for responding to life situations and other people in a manner that enables human flourishing. A concern taking hold in manifold fields ranging from IT, bioethics, and law, to philosophy and religion is that as personal data digitalization permeates ever more areas of human existence, humans risk becoming artifacts of technology production. This concern brings to center stage the very notion of what it means to be human, a notion encapsulated in the term human dignity, which broadly refers to the recognition that human beings possess intrinsic value and, as such, are endowed with certain rights and should be treated with respect. In this paper, we identify, describe, and transform what we know about personal data digitalization into a higher order theoretical structure around the concept of human dignity. The result of our analysis is the CARE (claims, affronts, response, equilibrium) theory of dignity amid personal data digitalization, a theory that explains the relationship of personal data digitalization to human dignity. Building upon the CARE theory as a foundation, researchers in a variety of IS research streams could develop mid-range theories for empirical testing or could use the CARE theory as an overarching lens for interpreting emerging IS phenomena. Practitioners and government agencies can also use the CARE theory to understand the opportunities and risks of personal data digitalization and to develop policies and systems that respect the dignity of employees and citizens.","PeriodicalId":18743,"journal":{"name":"MIS Q.","volume":"83 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"83274549","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2021-01-15DOI: 10.25300/MISQ/2021/15887
Reza Mousavi Baygi, Lucas D. Introna, Lotta Hultin
Ongoing digital innovations are transforming almost every aspect of our contemporary societies—rendering our lives and work evermore fluid and dynamic. This paper is an invitation to likewise remake our theorizing of socio-technological transformation by shifting from actor-centric orientations towards a flow-oriented approach and vocabulary. Such a shift from actors to the flows of action allows us to offer an innovative theory of socio-technological transformation that does not rely on self-contained actors or technologies as originators of transformation. Instead, it allows us to foreground how contingent confluences among heterogenous flows of action can account for the trajectories of socio-technological (trans)formation, both upstream and downstream. To do this, we turn to the work of social anthropologist Tim Ingold to advance a theoretical vocabulary of flowing lines of action and their correspondences. We expound three modalities of correspondence, namely: timing, attentionality, and undergoing, which together explain the dynamics of creation, sensing, and actualization of (trans)formative possibilities for action along socio-technological flows. We demonstrate the application and utility of this vocabulary through an empirical illustration and show how it reveals novel insights for IS research vis-a-vis existing theoretical alternatives. Finally, we outline the implications of our approach for IS research and suggest some guiding principles for studying and theorizing IS phenomena through this orientation. We invite the IS community to engage with our approach to develop novel ways of understanding and theorizing IS phenomena along our increasingly fluid and dynamic digital world, ever overflowing.
{"title":"Everything Flows: Studying Continuous Socio-Technological Transformation in a Fluid and Dynamic Digital World","authors":"Reza Mousavi Baygi, Lucas D. Introna, Lotta Hultin","doi":"10.25300/MISQ/2021/15887","DOIUrl":"https://doi.org/10.25300/MISQ/2021/15887","url":null,"abstract":"Ongoing digital innovations are transforming almost every aspect of our contemporary societies—rendering our lives and work evermore fluid and dynamic. This paper is an invitation to likewise remake our theorizing of socio-technological transformation by shifting from actor-centric orientations towards a flow-oriented approach and vocabulary. Such a shift from actors to the flows of action allows us to offer an innovative theory of socio-technological transformation that does not rely on self-contained actors or technologies as originators of transformation. Instead, it allows us to foreground how contingent confluences among heterogenous flows of action can account for the trajectories of socio-technological (trans)formation, both upstream and downstream. To do this, we turn to the work of social anthropologist Tim Ingold to advance a theoretical vocabulary of flowing lines of action and their correspondences. We expound three modalities of correspondence, namely: timing, attentionality, and undergoing, which together explain the dynamics of creation, sensing, and actualization of (trans)formative possibilities for action along socio-technological flows. We demonstrate the application and utility of this vocabulary through an empirical illustration and show how it reveals novel insights for IS research vis-a-vis existing theoretical alternatives. Finally, we outline the implications of our approach for IS research and suggest some guiding principles for studying and theorizing IS phenomena through this orientation. We invite the IS community to engage with our approach to develop novel ways of understanding and theorizing IS phenomena along our increasingly fluid and dynamic digital world, ever overflowing.","PeriodicalId":18743,"journal":{"name":"MIS Q.","volume":"30 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-01-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"88496282","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-12-27DOI: 10.25300/MISQ/2021/16027
J. Recker, R. Lukyanenko, M. Jabbari, Binny M. Samuel, A. Castellanos
The role of information systems (IS) as representations of real-world systems is changing in an increasingly digitalized world, suggesting that conceptual modeling is losing its relevance to the IS field. We argue the opposite: Conceptual modeling research is more relevant to the IS field than ever, but it requires an update with current theory. We develop a new theoretical framework of conceptual modeling that delivers a fundamental shift in the assumptions that govern research in this area. This move can make traditional knowledge about conceptual modeling consistent with the emerging requirements of a digital world. Our framework draws attention to the role of conceptual modeling scripts as mediators between physical and digital realities. We identify new research questions about grammars, methods, scripts, agents, and contexts that are situated in intertwined physical and digital realities. We discuss several implications for conceptual modeling scholarship that relate to the necessity of developing new methods and grammars for conceptual modeling, broadening the methodological array of conceptual modeling scholarship, and considering new dependent variables.
{"title":"From Representation to Mediation: A New Agenda for Conceptual Modeling Research in a Digital World","authors":"J. Recker, R. Lukyanenko, M. Jabbari, Binny M. Samuel, A. Castellanos","doi":"10.25300/MISQ/2021/16027","DOIUrl":"https://doi.org/10.25300/MISQ/2021/16027","url":null,"abstract":"The role of information systems (IS) as representations of real-world systems is changing in an increasingly digitalized world, suggesting that conceptual modeling is losing its relevance to the IS field. We argue the opposite: Conceptual modeling research is more relevant to the IS field than ever, but it requires an update with current theory. We develop a new theoretical framework of conceptual modeling that delivers a fundamental shift in the assumptions that govern research in this area. This move can make traditional knowledge about conceptual modeling consistent with the emerging requirements of a digital world. Our framework draws attention to the role of conceptual modeling scripts as mediators between physical and digital realities. We identify new research questions about grammars, methods, scripts, agents, and contexts that are situated in intertwined physical and digital realities. We discuss several implications for conceptual modeling scholarship that relate to the necessity of developing new methods and grammars for conceptual modeling, broadening the methodological array of conceptual modeling scholarship, and considering new dependent variables.","PeriodicalId":18743,"journal":{"name":"MIS Q.","volume":"113 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"76526760","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-12-24DOI: 10.25300/MISQ/2020/14947
Hong-xian Guo, Yipeng Liu, B. Nault
In this paper, we analyze the choice of interoperability approach for the provision of disaster management systems (DMS) when resources are distributed across districts and, in times of disaster, resources can be shared. The degree to which sharing (a spillover) can be coordinated efficiently depends on resource interoperability. In this public sector setting, we model the provisioning of DMS as the choice between interoperability approaches; in decreasing order of centralization they are integrated, unified, and federated. A unique feature of our setting is that the interoperability approach is a collective decision by districts. Districts choose their own DMS resources and interoperability effort, and face different interoperability efficiency and technology misfit costs depending on the interoperability approach. We find that any approach can be an equilibrium depending on interoperability efficiency, and that when the social optimum deviates from the equilibrium, the socially optimal approach is more centralized. When subsidies and taxes are implemented, the socially optimal interoperability approach can be achieved with budget balance. When only subsidies can be used, the socially optimal approach can be achieved but only under certain interoperability efficiency and misfit cost conditions is there a net social gain. Having an initial level of interoperability causes the equilibrium interoperability approach to shift toward a less centralized one. Our results generalize to other settings characterized by interoperability concerns, collective decisions, and spillovers.
{"title":"Provisioning Interoperable Disaster Management Systems: Integrated, Unified, and Federated Approaches","authors":"Hong-xian Guo, Yipeng Liu, B. Nault","doi":"10.25300/MISQ/2020/14947","DOIUrl":"https://doi.org/10.25300/MISQ/2020/14947","url":null,"abstract":"In this paper, we analyze the choice of interoperability approach for the provision of disaster management systems (DMS) when resources are distributed across districts and, in times of disaster, resources can be shared. The degree to which sharing (a spillover) can be coordinated efficiently depends on resource interoperability. In this public sector setting, we model the provisioning of DMS as the choice between interoperability approaches; in decreasing order of centralization they are integrated, unified, and federated. A unique feature of our setting is that the interoperability approach is a collective decision by districts. Districts choose their own DMS resources and interoperability effort, and face different interoperability efficiency and technology misfit costs depending on the interoperability approach. We find that any approach can be an equilibrium depending on interoperability efficiency, and that when the social optimum deviates from the equilibrium, the socially optimal approach is more centralized. When subsidies and taxes are implemented, the socially optimal interoperability approach can be achieved with budget balance. When only subsidies can be used, the socially optimal approach can be achieved but only under certain interoperability efficiency and misfit cost conditions is there a net social gain. Having an initial level of interoperability causes the equilibrium interoperability approach to shift toward a less centralized one. Our results generalize to other settings characterized by interoperability concerns, collective decisions, and spillovers.","PeriodicalId":18743,"journal":{"name":"MIS Q.","volume":"47 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"82854847","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-12-23DOI: 10.25300/MISQ/2021/14971
Xiao-cheng Zhang, P. Ferreira, M. Matos, Rodrigo Belo
Recommender systems have been introduced to help consumers navigate large sets of alternatives. They usually lead to more sales, which may increase consumer surplus and firm profit. In this paper, we ask whether firms may hurt consumers when they choose which recommender systems to use. We use data from a large scale field experiment ran using the video-on-demand system of a large telecommunications provider to measure the price elasticity of demand for movies placed in salient and non-salient slots on the TV screen. During this experiment, the firm randomized the slots in which movies were recommended to consumers as well as their prices. This setting readily allows for identifying the effects of price and slot on demand and thus compute consumer surplus. We find empirical evidence that consumers are less price elastic towards movies placed in salient slots. Using the outcomes of this experiment we simulate how consumer surplus and welfare change when the firm implements several recommender system, namely one that maximizes profit. We show that this system hurts both consumer surplus and welfare relative to the systems designed to maximize the latter. We also show that, at least in our setting, the system that maximizes profit does not generate less consumer surplus than some recommender systems often used in practice, such as content-based, lists of most sold, most rated and highest rated products. Yet, how much extra rent the firm can extract from strategically placing movies in salient slots is still a function of the popularity and quality of movies used to do so. Ultimately, our results question whether recommender systems embed mechanisms that extract excessive surplus from consumers, which may call for better scrutiny.
{"title":"Welfare Properties of Profit Maximizing Recommender Systems: Theory and Results from a Randomized Experiment","authors":"Xiao-cheng Zhang, P. Ferreira, M. Matos, Rodrigo Belo","doi":"10.25300/MISQ/2021/14971","DOIUrl":"https://doi.org/10.25300/MISQ/2021/14971","url":null,"abstract":"Recommender systems have been introduced to help consumers navigate large sets of alternatives. They usually lead to more sales, which may increase consumer surplus and firm profit. In this paper, we ask whether firms may hurt consumers when they choose which recommender systems to use. We use data from a large scale field experiment ran using the video-on-demand system of a large telecommunications provider to measure the price elasticity of demand for movies placed in salient and non-salient slots on the TV screen. During this experiment, the firm randomized the slots in which movies were recommended to consumers as well as their prices. This setting readily allows for identifying the effects of price and slot on demand and thus compute consumer surplus. We find empirical evidence that consumers are less price elastic towards movies placed in salient slots. Using the outcomes of this experiment we simulate how consumer surplus and welfare change when the firm implements several recommender system, namely one that maximizes profit. We show that this system hurts both consumer surplus and welfare relative to the systems designed to maximize the latter. We also show that, at least in our setting, the system that maximizes profit does not generate less consumer surplus than some recommender systems often used in practice, such as content-based, lists of most sold, most rated and highest rated products. Yet, how much extra rent the firm can extract from strategically placing movies in salient slots is still a function of the popularity and quality of movies used to do so. Ultimately, our results question whether recommender systems embed mechanisms that extract excessive surplus from consumers, which may call for better scrutiny.","PeriodicalId":18743,"journal":{"name":"MIS Q.","volume":"1 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"82988233","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-12-01DOI: 10.25300/MISQ/2020/14614
Lusi Li, Jianqing Chen, Srinivasan Raghunathan
Recommender systems have become the cornerstone of electronic marketplaces that sell products from competing sellers. Similar to traditional advertising, recommender systems can introduce consumers to new products and increase the market size which benefits sellers. This informative role of recommender systems in electronic marketplaces seems attractive to sellers because sellers do not pay the marketplaces for receiving recommendations. We show that in a marketplace that deploys a recommender system helping consumers discover the product that provides them the highest expected net utility, sellers do not necessarily benefit from the “free” exposure provided by the recommender system. The impacts of the recommender system are the result of a subtle interaction between advertising effect and competition effect. The advertising effect causes sellers to advertise less on their own and the competition effect causes them to decrease prices in the presence of a recommender system. Essentially, sellers “pay” in the form of more intense price competition because of the recommender system. Furthermore, the competition effect is exacerbated by the advertising effect because the recommender system alters a seller’s own strategies related to advertising intensity and price from being strategic substitutes in the absence of the recommender system to being strategic complements in its presence. As a result of these two effects, we find that sellers are more likely to benefit from the recommender system only when it has a high precision. The results do not change qualitatively whether sellers use targeted advertising or uniform advertising. However, we find that a recommender system that benefits sellers when they do not employ targeted advertising may actually hurt them when they adopt targeted advertising with a high precision. On the other hand, in the presence of the recommender system, an increase in sellers’ targeting precision beyond a threshold softens price competition, increases seller profits, and reduces consumer surplus. Finally, we find that when the recommender system assigns a larger weight to product fit than price, the adverse impacts of the recommender system on sellers are mitigated, thereby expanding the region in the parameter space where the recommender system is beneficial to sellers.
{"title":"Informative Role of Recommender Systems in Electronic Marketplaces: A Boon or a Bane for Competing Sellers","authors":"Lusi Li, Jianqing Chen, Srinivasan Raghunathan","doi":"10.25300/MISQ/2020/14614","DOIUrl":"https://doi.org/10.25300/MISQ/2020/14614","url":null,"abstract":"Recommender systems have become the cornerstone of electronic marketplaces that sell products from competing sellers. Similar to traditional advertising, recommender systems can introduce consumers to new products and increase the market size which benefits sellers. This informative role of recommender systems in electronic marketplaces seems attractive to sellers because sellers do not pay the marketplaces for receiving recommendations. We show that in a marketplace that deploys a recommender system helping consumers discover the product that provides them the highest expected net utility, sellers do not necessarily benefit from the “free” exposure provided by the recommender system. The impacts of the recommender system are the result of a subtle interaction between advertising effect and competition effect. The advertising effect causes sellers to advertise less on their own and the competition effect causes them to decrease prices in the presence of a recommender system. Essentially, sellers “pay” in the form of more intense price competition because of the recommender system. Furthermore, the competition effect is exacerbated by the advertising effect because the recommender system alters a seller’s own strategies related to advertising intensity and price from being strategic substitutes in the absence of the recommender system to being strategic complements in its presence. As a result of these two effects, we find that sellers are more likely to benefit from the recommender system only when it has a high precision. The results do not change qualitatively whether sellers use targeted advertising or uniform advertising. However, we find that a recommender system that benefits sellers when they do not employ targeted advertising may actually hurt them when they adopt targeted advertising with a high precision. On the other hand, in the presence of the recommender system, an increase in sellers’ targeting precision beyond a threshold softens price competition, increases seller profits, and reduces consumer surplus. Finally, we find that when the recommender system assigns a larger weight to product fit than price, the adverse impacts of the recommender system on sellers are mitigated, thereby expanding the region in the parameter space where the recommender system is beneficial to sellers.","PeriodicalId":18743,"journal":{"name":"MIS Q.","volume":"5 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"88449668","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-12-01DOI: 10.25300/MISQ/2020/13991
Tanya Tang, Eric Fang, W. Qualls
Previous research has predominantly taken a social network perspective suggesting that building more network connections or becoming deeply embedded in a network provides a better position to access network knowledge in open source software communities.This perspective implicitly assumes that accessed network knowledge automatically gets absorbed and transferred to projects, so that building more and deeper network connections is beneficial: Drawing from an absorptive capacity perspective, this research challenges such conventional wisdom, arguing instead that the benefits depend on a project’s absorptive capacity. Network connections provide access to external knowledge in the community; the absorption and transfer of this new knowledge require appropriate internal knowledge and developer roles. With longitudinal data collected from 4,518 open source software development projects hosted at SourceForge, the authors show that knowledge breadth (depth) helps with the absorption of external knowledge achieved from network depth (breadth), but it inhibits the absorption of external knowledge obtained from network breadth (depth). Further, developer roles (e.g., bridge members, role diversity) can mitigate the negative consequences of suboptimal combinations and facilitate effective transfers of absorbed external knowledge across and within projects. These findings provide important theoretical and managerial implications for managing network connections, knowledge, and developer roles in open source software communities.
{"title":"More Is Not Necessarily Better: An Absorptive Capacity Perspective on Network Effects in Open Source Software Development Communities","authors":"Tanya Tang, Eric Fang, W. Qualls","doi":"10.25300/MISQ/2020/13991","DOIUrl":"https://doi.org/10.25300/MISQ/2020/13991","url":null,"abstract":"Previous research has predominantly taken a social network perspective suggesting that building more network connections or becoming deeply embedded in a network provides a better position to access network knowledge in open source software communities.This perspective implicitly assumes that accessed network knowledge automatically gets absorbed and transferred to projects, so that building more and deeper network connections is beneficial: Drawing from an absorptive capacity perspective, this research challenges such conventional wisdom, arguing instead that the benefits depend on a project’s absorptive capacity. Network connections provide access to external knowledge in the community; the absorption and transfer of this new knowledge require appropriate internal knowledge and developer roles. With longitudinal data collected from 4,518 open source software development projects hosted at SourceForge, the authors show that knowledge breadth (depth) helps with the absorption of external knowledge achieved from network depth (breadth), but it inhibits the absorption of external knowledge obtained from network breadth (depth). Further, developer roles (e.g., bridge members, role diversity) can mitigate the negative consequences of suboptimal combinations and facilitate effective transfers of absorbed external knowledge across and within projects. These findings provide important theoretical and managerial implications for managing network connections, knowledge, and developer roles in open source software communities.","PeriodicalId":18743,"journal":{"name":"MIS Q.","volume":"40 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"91195203","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-12-01DOI: 10.25300/MISQ/2020/15685
Jin Gerlach, Ronald T. Cenfetelli
“Constant checking” of digital devices has been a widely observed phenomenon: people check email clients, social networking systems, news websites, and other information technologies (ITs) at the expense of distracted driving, neglected children, and lost productivity. The predominant perspective on such phenomena of excessive IT use is that users are addicted to technology. But actually, we know very little about what exactly “constant checking” is, what causes it, and under what conditions negative outcomes might ensue. Based on qualitative data collected from 90 individuals, we develop a grounded theory that views “constant-checking” behaviors as information-seeking habits instead of an addiction in need of medical treatment. We find that these habits satisfy deep-rooted and recurring needs for information, are facilitated by today’s high accessibility of information, and are fueled by an interesting reward pattern. To represent “constant-checking” behaviors in light of our findings, we posit a new construct: IT-mediated state-tracking, defined as an individual’s habitual use of IT to seek information that closes the gap between their knowledge about a real-world domain’s state and its actual state. We also learn that the intended and unintended consequences of IT-mediated state-tracking are contingent upon situational factors, which suggests that a more balanced perspective on these behaviors is warranted. Our research steers the discussion about excessive IT use in a new direction by offering a new construct and a grounded theory that helps us to better understand the phenomenon of “constant checking.”
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