The Journal of behavioral economics最新文献

In this article a stochastic model of choice is developed that is based on game theory. The model is developed to demonstrate that a basic stochastic model can yield results similar to phenomena discovered in consumer behavior. In particular, a definition of brand loyalty is developed along with a basis for rational intransitivity of preferences, which is noted by brand switching. A measurement approach is also presented along with an example. The basic intent is to demonstrate that stochastic approaches to choice do have a foundation in both theoretical development beside observations in empirical studies.

This article reports experiments dealing with individual subject valuation and preference over prospect pairs that are known to generate systematic intransitivities in choice behavior termed “preference reversals”. The authors examine whether alternative procedures to those previously employed for eliciting individual limit selling prices over prospects alters the incidence or dollar magnitude of preference reversals. It is found that when individual limit selling prices over prospects are elicited in a repetitive, second-price sealed Vickrey (1961) auction market framework, rather than under the traditional single response Becker, DeGroot, and Marshak (1964) procedure, that the dollar magnitude of preference reversals declines significantly. Initially, when opening Vickrey auction limit selling prices are combined with individual subject choices over prospects, previous results like those of Grether and Plott (1979) are obtained. When ending Vickrey auction limit selling prices are combined with individual subject choices over prospects, the dollar magnitude of reversals declines significantly. These results imply that markets can be efficient and yield market clearing prices under a given arrangement of property rights even if the behavior of some individuals is inconsistent with expected utility theory.

This article theoretically develops and empirically tests the relationship between criminal homicide crime rates in the United States for the period 1965–1985 and the deterrent effect of capital punishment by utilizing a recursive system of equations method. The analysis reveals that not only does a deterrent effect of capital punishment exist but also that changes in commonly selected law enforcement, judicial, demographic, and economic control variables are significant in a manner consistent with implications from general theoretical models of criminal behavior and within frameworks specifically dealing with murder and nonnegligent manslaughter.

Paul Carlin's article on shirking (Journal of Behavioral Economics, 18[2], 1989) continues a tradition of assuming that shirking, which is defined as a minor form of improper behavior, is a form of employee behavior that is always counterproductive. In this note, the author argues that tolerance of selective shirking must be understood as both an employee benefit that may be less costly than higher wages and as a mechanism for actually increasing productivity.

Existing models of shirking are not consistent with the underlying behavior of employers and employees. In these models, either shirking does not occur in equilibrium or it may occur but the offending employee is immediately dismissed. These conclusions conflict with evidence that shirking is sometimes ignored by firms for many years. To resolve this conflict, the author models the interaction between employer and employees as a finite repeated game, and introduces the quasi-fixed costs of dismissing and replacing an employee. Shirking is distinguished from more serious malfeasant behavior by the criterion of imposing current period costs on the employer that are less than the cost of dismissing and replacing a shirking employee. When both the employer and the employees are rational and there are no informational asymmetries, shirking is not deterred by threat of dismissal. Introducing informational asymmetries leads to an equilibrium where shirking is deterred, to a great extent, by the dismissal threat. Comparative static analysis of the model yields testable implications on the incidence of shirking across firms, and contributes to our understanding of other labor market issues.

This article reports the results of a 1988 survey of business executives on the issue of ethics. The survey is directly comparable with a similar survey conducted in 1983. With the exception of a few marginal changes the responses showed no significant differences between the two years. Consequently, allegations of a decline in business ethics over the period would appear to be premature.

Empirical tests of the theory of compensating differentials using a wage-change formulation have had mixed success in providing support for the theory. Previous studies have differed with respect to the measurement and type of working conditions, the sample of workers examined, and the inclusion of firm- specific information. To isolate the role of the differences between previous studies in providing support for the theory, the author estimates a wage-change model using data from a broad sample of workers with self-reported job characteristics. The conclusion is that the general theory of compensating differentials be revised to include firm-specific information. However, it is not clear if any test of the theory can be supported over a broad range of occupations in the short run.

Data from a contingent valuation survey of New Jersey beaches provides a test of starting point bias. Subsamples were delineated corresponding to levels of respondent understanding of the commodity being valued. A means- difference test showed statistically significant starting point bias for each subsample of respondents. A bid function is used to show that starting point bias is present and it increases as the level of information (understanding) decreases. Starting point bias was found even though respondents were actually using and paying for the commodity in question and the starting bids were in the neighborhood of the entry fee.

This article posits transaction costs as the reason manufacturers use dual distribution (i.e., sell to customers through both independent and company- owned distributions). The authors base their analysis on Williamson's four types of transaction costs, and identify eight explanations for dual distributions. These reasons are lifecycle considerations, lack of distributor competition, information costs, facilitation of collusion, manufacturer opportunism, price discrimination, customer service and manufacturer efficiencies. They conclude that the competitive effect of dual distribution depends on which of the above explanations is relevant. If more than one explanation is valid, it may be necessary to balance the competitive effects in both the manufacturing and retail markets to evaluate the practice.