minimum effort coordination games stochastic potential and logit equilibrium abstract this paper revisits the minimum effort coordination game with a continuum of pareto ranked nash equilibria noise is introduced via a logit probabilistic choice function the resulting logit equilibrium distribution of decisions is unique and maximizes a stochastic potential function in the limit as the noise vanishes the distribution converges to an outcome that is analogous to the risk dominant outcome for 2 2 games in accordance with experimental evidence logit equilibrium efforts decrease with increases in effort costs and the number of players even though these parameters do not affect the nash equilibria journal of economic literature classification numbers c72 c92

ten little treasures of game theory and ten intuitive contradictions this paper reports laboratory data for games that are played only once these games span the standard categories static and dynamic games with complete and incomplete information for each game the treasure is a treatment in which behavior conforms nicely to predictions of the nash equilibrium or relevant refinement in each case however a change in the payoff structure produces a large inconsistency between theoretical predictions and observed behavior these contradictions are generally consistent with simple intuition based on the interaction of payoff asymmetries and noisy introspection about others decisions

farm growth and survival econometric evidence for individual farms in upper austria this article investigates survival and growth of more than 50 000 upper austrian farm households within a maximum likelihood sample selection framework the results suggest that age schooling and sex of the farm operator size of the farm family and off farm employment status as well as initial farm size significantly influence farm growth and survival the present study provides support for the notion of a disappearing middle in the size distribution the process of polarization is closely related to the off farm employment status of farms correcting for sample attrition bias is important when analyzing the performance of part time farms

agricultural payments and land concentration a semiparametric spatial regression analysis over the last twenty years both crop production and agricultural payments have shifted toward larger operations this study examines whether payments from federal farm programs contributed to increased concentration of cropland and farmland using zip code level data constructed from the microfiles of the 1987 2002 agriculture censuses we examine the association between government payments per acre and subsequent growth in land concentration a semiparametric generalized additive model gam controls for location and historical concentration sales per acre and ratio of cropland area to zip code area findings indicate both with and without nonparametric controls government payments are strongly associated with subsequent concentration growth copyright 2008 oxford university press

antecedents and consequences of marketing dynamic capabilities in international joint ventures the influence of firms dynamic capabilities on performance has been well articulated in the strategy literature yet conceptualization and operationalization of dynamic capabilities in marketing function have not been attempted and empirical evidence substantiating the effect of dynamic capabilities is scarce this research develops a conceptualization of marketing dynamic capabilities mdcs investigates their development in international joint ventures ijvs and explores their effect on ijvs performance and competitive advantage using a dyadic dataset collected from top managers of ijvs in china as well as objective performance data collected separately the study found empirical support for the effect of mdcs on ijvs competitive advantage and performance in addition mdcs are found to be influenced by ijv resource magnitude resource complementarity organizational culture and organizational structure the theoretical implications of our findings and future research directions are also discussed

a theoretical analysis of altruism and decision error in public goods games abstract we formalize an equilibrium model in which altruism and decision error parameters determine the distribution of contributions for linear and quadratic public goods games the equilibrium density is exponential for linear games and normal for quadratic games our model implies i contributions increase with the marginal value of the public good ii total contributions increase with the number of participants iii mean contributions lie between the nash prediction and half the endowment these predictions which are not implied by a nash analysis are consistent with laboratory data maximum likelihood estimates of altruism and error parameters are significant and plausible

why farmers quit a county level analysis we identify the effects of alternative explanatory variables on the propensity of u s farmers to cease farming with a particular emphasis on understanding the roles of off farm employment and federal farm program payments conventional ordinary least squares analysis using all counties suggests that off farm employment has no statistical effect on the net number of farmers quitting between 1987 and 1997 ceteris paribus a more refined analysis which separates counties losing farmers from those that gained farmers reveals subtle and less clear cut effects of off farm employment and federal program payments on farm exits copyright 2001 oxford university press

rent seeking with bounded rationality an analysis of the all pay auction the winner take all nature of all pay auctions makes the outcome sensitive to decision errors which we introduce with a logit formulation the equilibrium bid distribution is a fixed point the belief distributions that determine expected payoffs equal the choice distributions determined by expected payoffs we prove existence uniqueness and symmetry properties in contrast to the nash equilibrium the comparative statics of the logit equilibrium are intuitive rent dissipation increases with the number of players and the bid cost overdissipation of rents is impossible under full rationality but is observed in laboratory experiments our model predicts this property

games with unique mixed strategy equilibria an experimental study abstract the results of an experiment studying the choices of subjects playing mixed extensions of three variants of simple 2 2 non constant sum strictly competitive games of the same form matching pennies are presented subjects exhibited a variety of behavioral adaptive learning strategies this heterogeneity of individual behavior produced aggregate dynamics whose estimated steady states are quite different from those predicted by the nash equilibria of those stage games with asymmetrical payoff functions the observed aggregative dynamics are well accounted for both by a quantal equilibrium model of mckelvey and palfrey and by a learning model of roth and erev journal of economic literature classification number c72

the growth of family farms in hungary the article investigates the validity of gibrat s law for hungarian family farms using fadn data collected between 2001 and 2007 gibrat s law states that the growth rate of firms will be independent of their initial size regression results allow us to reject gibrat s law for all quantiles evidence suggests that smaller farms tend to grow faster than larger ones results do not support the hypothesis of disappearing middle in hungarian agriculture we study a number of socio economic factors that can help to explain farm growth we find that total subsidies received by a farm and the farm operator s age are the most significant factors correlated with farm growth

impulse balance in the newsvendor game abstract one striking behavioral phenomenon is the pull to center bias in the newsvendor game facing stochastic demand subjects tend to order quantities between the expected profit maximizing quantity and mean demand we show that the impulse balance equilibrium which is based on a simple ex post rationality principle along with an equilibrium condition predicts the pull to center bias and other more subtle observations in the laboratory newsvendor game

progress in behavioral game theory i s game theory meant to describe actual choices by people and institutions or not it is remarkable how much game theory has been done while largely ignoring this question the seminal book by von neumann and morgenstern the theory of games and economic behavior was clearly about how rational players would play against others they knew were rational in more recent work game theorists are not always explicit about what they aim to describe or advise at one extreme highly mathematical analyses have proposed rationality requirements that people and firms are probably not smart enough to satisfy in everyday decisions at the other extreme adaptive and evolutionary approaches use very simple modelsmostly developed to describe nonhuman animals in which players may not realize they are playing a game at all when game theory does aim to describe behavior it often proceeds with a disturbingly low ratio of careful observation to theorizing this paper describes an approach called behavioral game theory which aims to describe actual behavior is driven by empirical observation mostly experiments and charts a middle course between over rational equilibrium analyses and under rational adaptive analyses the recipe for behavioral game theory i will describe has three steps start with a game or naturally occurring situation in which standard game theory makes a bold prediction based on one or two crucial principles if behavior differs from interested readers familiar with game theory should read crawford 1997 whose approach is more eclectic than mine he concludes p 236 that most strategic behavior can be understood via a synthesis that combines elements from each of the leading theoretical frameworks traditional game theory evolutionary game theory and adaptive learning with a modicum of empirical information about behavior behavioral game theory adds psychological interpretations to this synthesis

english auctions with resale an experimental study i design and test a simple english auction and two english auctions with resale but with different informational backgrounds all three treatments theoretically have the same equilibrium i find however that the possibility of resale alters behavior significantly in the two treatments with resale subjects deviated from both the nash prediction and the common results about bidding behavior in english auctions subjects tend to overbid when they are certain they can reap the whole surplus in the resale market i employ different models like qre and levels of reasoning and conclude that overbidding can be explained as a rational response to the noisy environment in markets with human participants that is as rational decision making when anticipating others to make errors when the outcome of the resale market is not certain there is significant signaling behavior and auction prices tend to be lower than the nash prediction

prices technology and farm size in this paper we construct and empirically test a theory of the agricultural firm which explains the long term growth in farm size in the united states typically the u s farm unit is a family enterprise consequently the ratio of the opportunity cost of farm labor to the price of machinery services determines the size of the farm operation by influencing the machine labor ratio applying the model to u s data we explain virtually all of the growth in the machine labor ratio and in farm size over the 1930 70 period by changes in relative factor prices without reference to technological change or economies of scale

diseconomies of size with fixed managerial ability managerial ability has important implications for farm growth in this article we first show in a production model that increasing output with a fixed level of managerial ability can lead to a decrease in profits next we discuss the effect that managerial ability has on economies of size in the empirical part economies of size are estimated for a sample of dairy farms using a proxy for managerial ability which is calculated as a technical efficiency index the results show that increasing farm size while holding managerial ability constant can be an important source of diseconomies of size copyright 2003 oxford university press

the logit equilibrium a perspective on intuitive behavioural anomalies costs associated with deviations from the nash equilibrium these payoff asymmetry effects are incorporated in an approach that introduces noisy behavior via a logit probabilistic choice function in the resulting logit equilibrium behavior is characterized by a probability distribution that satisfies a rational expectations consistency condition the beliefs that determine players expected payoffs match the decision distributions that arise from applying the logit rule to those expected payoffs we prove existence of a unique symmetric logit equilibrium and derive comparative statics results the paper provides a unified perspective on many recent laboratory studies of games in which nash equilibrium predictions are inconsistent with both intuition and experimental evidence

do firms learn to create value the case of alliances we investigate whether firms learn to manage interfirm alliances as experience accumulates we use contract specific experience measures in a data set of over 2000 joint ventures and licensing agreements and value creation measures derived from the abnormal stock returns surrounding alliance announcements learning effects are identified from the effects of unobserved heterogeneity in alliance capabilities we find evidence of large learning effects in managing joint ventures but no such evidence for licensing contracts the effects of learning on value creation are strongest for research joint ventures and weakest for marketing joint ventures these results are consistent with the view that learning effects are more important in situations characterized by greater contractual ambiguity copyright 2000 john wiley sons ltd

quantal response methods for equilibrium selection in 2 2 coordination games abstract the notion of quantal response equilibrium qre introduced by mckelvey and palfrey 1995 has been widely used to explain experimental data in this paper we use quantal response equilibrium as a homotopy method for equilibrium selection and study this in detail for 2 2 bimatrix coordination games we show that the risk dominant equilibrium need not be selected in the logarithmic game the limiting qre is the nash equilibrium with the larger sum of square root payoffs finally we apply the quantal response methods to the mini public goods game with punishment a cooperative equilibrium can be selected if punishment is strong enough

overbidding and overspreading in rent seeking experiments cost structure and prize allocation rules we study experimentally the effects of cost structure and prize allocation rules on the performance of rent seeking contests most previous studies use a lottery prize rule and linear cost and find both overbidding relative to the nash equilibrium prediction and significant variation of efforts which we term overspreading we investigate the effects of allocating the prize by a lottery versus sharing it proportionally and of convex versus linear costs of effort while holding fixed the nash equilibrium prediction for effort we find the share rule results in average effort closer to the nash prediction and lower variation of effort combining the share rule with a convex cost function further enhances these results we can explain a significant amount of non equilibrium behavior by features of the experimental design these results contribute towards design guidelines for contests based on behavioral principles that take into account implementation features of a contest

do people play nash equilibrium lessons from evolutionary game theory evolutionary game theory provides an answer to two of the central questions in economic modeling when is it reasonable to assume that people are rational and when is it reasonable to assume that behavior is part of a nash equilibrium and if it is reasonable which equilibrium the traditional answers are not compelling and much of evolutionary modeling is motivated by the need for a better answer evolutionary game theory suggests that in a range of settings agents do eventually play a nash equilibrium moreover evolutionary modeling has shed light on the relative plausibility of different nash equilibria

rationalizable strategic behavior the notion of equilibrium proposed by nash 19 has come to play a dominant role in economic applications of noncooperative games while analyses of nash equilibria have unquestionably contributed to our understanding of economic behavior it would be unreasonably optimistic to maintain that nash solved the problem of noncooperative strategic choice there is a small literature beginning with ellsberg 6 and a much larger oral tradition which argues that nash behavior is neither a necessary consequence of rationality nor a reasonable empirical proposition in this paper i take the view that although there may be various reasons why an agent might select a nash strategy the notion of an equilibrium has little intrinsic appeal within a strategic context when an agent reaches a decision in ignorance of the strategies adopted by other players rationality consists of making a choice which is justifiable by an internally consistent system of beliefs rather than one which is optimal post hoc this point of view is not original indeed most serious justifications of the nash hypothesis embrace such an approach arguing that agents will expect the game to yield a nash outcome and consequently will choose their equilibrium strategies nevertheless when we think in terms of maximizing utility subject to expectations rather than realizations it becomes clear that the nash hypothesis far from being a consequence of rationality arises from certain restrictions on agents expectations which may or may not be plausible depending upon the game being played we are then quite naturally led to ask are there any restrictions of individuals expectations and hence choices which are required by rationality alone rather than by subjective plausibility this paper is concerned with defining justifying characterizing and refining a criterion for rational strategic choice which i label rationalizability

platform selection in the lab abstract emerging literature explores experimental platform selection games these games converge rapidly on the superior platform under a wide range of conditions we replicate the remarkable results of hossain and morgan 2009 in which such a game tips almost perfectly to the superior platform next we show that platform coordination fails when seemingly innocent increases in out of equilibrium payoffs are introduced the inflated payoffs keep the best reply structure unchanged and do not influence players security levels our design allows control for the explanatory force of risk dominance we find that equilibrium selection theory is unable to account for coordination failure while observed behavior is consistent with non rational learning furthermore and contrary to the literature we find that efficiency suffers when an inferior platform is granted initial monopoly

a test of stability in a linear altruism model linear altruism predicts the estimated preferences to be independent of the subject s position in the game if the role allocation is randomly determined because subjects in each role have the same preferences ex ante we test and reject this hypothesis

rationalizable strategic behavior and the problem of perfection this paper explores the fundamental problem of what can be inferred about the outcome of a noncooperative game from the rationality of the players and from the information they possess the answer is summarized in a solution concept called rationalizability strategy profiles that are rationalizable are not always nash equilibria conversely the information in an extensive form game often allows certain unreasonable nash equilibria to be excluded from the set of rationalizable profiles a stronger form of rationalizability is appropriate if players are known to be not merely rational but also cautious what constitutes rational behavior in a noncooperative strategic situation this paper explores the issue in the context of a wide class of finite noncooperative games in extensive form the traditional answer relies heavily upon the idea of nash equilibrium nash 17 the position developed here however is that as a criterion for judging a profile of strategies to be reasonable choices for players in a game the nash equilibrium property is neither necessary nor sufficient some nash equilibria are intuitively unreasonable and not all reasonable strategy profiles are nash equilibria the fact that a nash equilibrium can be intuitively unattractive is well known the equilibrium may be imperfect introduced into the literature by selten 20 the idea of imperfect equilibria has prompted game theorists to search for a narrower definition of equilibrium while this research some of which will be discussed here has been extremely instructive it remains inconclusive theorists often agree about what should happen in particular games but to capture this intuition in a general solution concept has proved to be very difficult if this paper is successful it should make some progress in that direction the other side of the coin has received less scrutiny can all non nash profiles really be excluded on logical grounds i believe not the standard justifications for considering only nash profiles are circular in nature or make gratuitous assumptions about players decision criteria or beliefs the following discussion of these points is extremely brief due to space constraints more detailed arguments may be found in pearce 18

heterogeneous social preferences recent research has shown the usefulness of social preferences for explaining behavior in laboratory experiments this paper demonstrates that models of social preferences are particularly powerful in explaining behavior if they are embedded in a setting of heteroge neous actors with heterogeneous social preferences for this purpose a simple model is in troduced that combines the basic ideas of inequity aversion social welfare preferences recip rocity and heterogeneity this model is applied to 43 games and it can be shown that its pre dictive accuracy is clearly higher than that of the isolated approaches furthermore it can explain most of the anomalies the contradictions that are discussed in goeree and holt 2001

the effect of national culture on the choice of entry mode characteristics of national cultures have frequently been claimed to influence the selection of entry modes this article investigates this claim by developing a theoretical argument for why culture should influence the choice of entry two hypotheses are derived which relate culture to entry mode choice one focusing on the cultural distance between countries the other on attitudes towards uncertainty avoidance using a multinomial logit model and controlling for other effects the hypotheses are tested by analysing data on 228 entries into the united states market by acquisition wholly owned greenfield and joint venture empirical support for the effect of national culture on entry choice is found

farm level production effects from participation in government commodity programs did the 1996 federal agricultural improvement and reform act make a difference in theory lump sum transfers are a way to redistribute wealth without distorting production decisions recent agricultural policy reforms are an unusual large scale application of this concept the 1996 federal agricultural improvement and reform fair act removed most price contingent agricultural subsidies and replaced them with production flexibility contracts lump sum payments with few ties to farmers production decisions the payments were envisioned as way to maintain income transfers to agricultural interests while minimizing production distortions the united states has argued that these decoupled agricultural payments are minimally trade distorting usda ers there is a great deal of uncertainty about how the system of agricultural payments established under the 1996 reforms affects production some including representatives from developing nations with domestic agricultural sectors that compete with the united states contend that decoupled payments significantly affect agricultural production and trade two general arguments underpin this assertion first decoupled payments are not really lump sum that is despite the reforms important links to production remain for example there are restrictions in the fair act that preclude new vegetable plantings or the conversion of land to nonagricultural uses second the perfect market assumptions underpinning the

anomalous behavior in a traveler s dilemma the notion of a nash equilibrium has joined supply and demand as one of the two or three techniques that economists instinctively try to use first in the analysis of economic interactions moreover the nash equilibrium and closely related game theoretic concepts are being widely applied in other social sciences and even in biology where evolutionary stability often selects a subset of the nash equilibria many people are uneasy about the stark predictions of the nash equilibrium in some contexts where the extreme rationality assumptions seem implausible kaushik basu s 1994 traveler s dilemma is a particularly convincing example of a case where the unrelenting logic of game theory is at odds with intuitive notions about human behavior the story associated with the dilemma is that two travelers purchase identical antiques while on a tropical vacation their luggage is lost on the return trip and the airline asks them to make independent claims for compensation in anticipation of excessive claims the airline representative announces

equity joint ventures and theory of the multinational enterprise this paper extends the internalization approach to the theory of the multinational enterprise mne to include an expanded role for equity joint ventures using the transaction cost paradigm of williamson this paper explains why joint ventures may sometimes be preferred over wholly owned subsidiaries also presented is empirical work on joint venture performance in developing countries which demonstrates that under certain conditions joint ventures can be the optimal mode of foreign direct investment 1987 jibs journal of international business studies 1987 18 1 16

lowest unmatched price auctions lowest unmatched price auctions lupas specify that the lowest bid placed by only one participant wins they are used in internet trading and tv and radio shows we model lupas as games with minimal restrictions in particular allowing players to place more than one bid since multiple bids have been observed in most actual lupas though lupas are games for which a closed form solution does not seem to exist in general our model generates several testable implications about the type of strategies played in equilibrium and the highest bid in a given lupa our analysis suggests that players follow strategic considerations and arrive at decisions which at least in the aggregate are generally consistent with theoretical predictions yet there are some remarkable deviations

games of perfect information predatory pricing and the chain store paradox the thesis of this paper is that finite noncooperative games possessing both complete and perfect information ought to be treated like one player decision problems that is players ought to assign at every move subjective probabilities to every subsequent choice in the game and ought to make decisions via backward induction this view is in contrast with the gametheoretic approach of nash equilibrium after expanding on this view for games in the abstract in sections 2 and 3 attention is turned in section 4 to an example due to reinhard selten called the chain store paradox which possesses the flavor of a situation involving a predatory pricing monopolist it is argued that for the chain store game the decision analytic approach leads under certain assumptions to more realistic outcomes than the standard nash equilibrium approach

equity joint ventures and the theory of the multinational enterprise this paper extends the internalization approach to the theory of the multinational enterprise mne to include an expanded role for equity joint ventures using the transaction cost paradigm of williamson this paper explains why joint ventures may sometimes be preferred over wholly owned subsidiaries also presented is empirical work on joint venture performance in developing countries which demonstrates that under certain conditions joint ventures can be the optimal mode of foreign direct investment

an introduction to applicable game theory this paper offers an introduction to game theory for applied economists i try to give simple definitions and intuitive examples of the basic kinds of games and their solution concepts there are four kinds of games static or dynamic and complete or incomplete information complete information means there is no private information the corresponding solution concepts are nash equilibrium in static games of complete information backwards induction or subgame perfect nash equilibrium in dynamic games of complete information bayesian nash equilibrium in static games with incomplete information and perfect bayesian or sequential equilibrium in dynamic games with incomplete information the main theme of the paper is that these solution concepts are closely linked as we consider progressively richer games we progressively strengthen the solution concept to rule out implausible equilibria in the richer games that would survive if we applied solution concepts available for simpler games in each case the stronger solution concept differs from the weaker concept only for the richer games not for the simpler games

signalling and adaptive learning in an entry limit pricing game in an experimental investigation of milgrom and roberts 1992 model play consistently converges to a unique equilibrium providing evidence of sophisticated strategic behavior that the theory predicts play starts with monopolists at their myopic maxima followed by an attempt to pool and then if no pooling equilibrium exists separation suggesting myopia rather than a forward looking process when both pure strategy equilibria and separating equilibria exist equilibrium selection is a function of the past history of play an adaptive learning model characterizes the major features of the data and provides predictions of intermediate term behavior that is otherwise lacking in the theory

the effects of payoff magnitude and heterogeneity on behavior in 2 2 games with unique mixed strategy equilibria the logit version of quantal response equilibrium predicts that equilibrium behavior in games will vary systematically with payoff magnitudes if all other factors are held constant including the nash equilibria of the game we explore this in the context of a set of asymmetric 2x2 games with unique totally mixed strategy equilibria the data provide little support for the payoff magnitude predictions of the logit equilibrium model we extend the theoretical quantal response equilibrium model to allow for heterogeneity and find that the data fit the heterogeneous version of the theory significantly better

dynamic capabilities what are they this paper focuses on dynamic capabilities and more generally the resource based view of the firm we argue that dynamic capabilities are a set of specific and identifiable processes such as product development strategic decision making and alliancing they are neither vague nor tautological although dynamic capabilities are idiosyncratic in their details and path dependent in their emergence they have significant commonalities across firms popularly termed best practice this suggests that they are more homogeneous fungible equifinal and substitutable than is usually assumed in moderately dynamic markets dynamic capabilities resemble the traditional conception of routines they are detailed analytic stable processes with predictable outcomes in contrast in high velocity markets they are simple highly experiential and fragile processes with unpredictable outcomes finally well known learning mechanisms guide the evolution of dynamic capabilities in moderately dynamic markets the evolutionary emphasis is on variation in high velocity markets it is on selection at the level of rbv we conclude that traditional rbv misidentifies the locus of long term competitive advantage in dynamic markets overemphasizes the strategic logic of leverage and reaches a boundary condition in high velocity markets copyright 2000 john wiley sons ltd

redistribution and market efficiency an experimental study abstract we study the interaction between competitive markets and income redistribution that reallocates unequal pre tax market incomes away from the rich to the poor majority in one setup participants earn their income by trading in a double auction da with exogenous zero or full redistribution in another setup after trading they vote on redistributive tax policies in a majoritarian election with two competing candidates this results in virtually full redistribution even when participants have the opportunity to influence taxes by transferring money to the candidates we find that the high redistribution reduces trading efficiency but not as much as predicted if market participants trade randomly this is because rather than capitulating to the much lower trading incentives many participants respond to redistribution by asking and bidding more conservatively in the da and in this way help to prevent further efficiency losses

an experimental study of jury decision rules we present experimental results on groups facing a decision problem analogous to that faced by a jury we consider three treatment variables group size three or six number of votes needed for conviction majority or unanimity and pre vote deliberation we find evidence of strategic voting under the unanimity rule a large fraction of our subjects vote for a decision analogous to conviction even when their private information indicates a state analogous to innocence this is roughly consistent with the game theoretic predictions of feddersen and pesendorfer although individual behavior is explained well by the game theoretic model there are discrepancies at the level of the group decision contrary to feddersen and pesendorfer in our experiments there are fewer outcomes analogous to incorrect convictions under unanimity rule than under majority rule in the case of no deliberation we simultaneously account for the individual and group data using quantal response equilibrium

an econometric analysis of the effects of human capital on size and growth among dairy farms the analysis of size distributions of firms has long been important both inside and outside of agriculture the study of farm size has focused on economies of scale optimal efficient size technical change descriptions of distributions and informal considerations of policy outside of farming the emphasis has been on the relationships between size and growth in both literatures there has been some awareness of the role of the firm operator in firm size and growth in this paper we examine herd size and herd growth for a large sample of southern dairy farms our emphasis is on the relationship of human capital of the operator to the crosssectional size and growth patterns other related work considers size growth issues in more detail sumner and leiby our research relates to several literatures that have evolved along distinct paths these include the analysis of the size distribution of farms see stanton the role of human capital in agriculture and earnings distributions and the analysis of the size distribution of business firms

cooperating over losses and competing over gains a social dilemma experiment evidence from studies in international relations the politics of reform collective action and price competition suggests that economic agents in social dilemma situations cooperate more to avoid losses than in the pursuit of gains to test whether the prospect of losses can induce cooperation we let experimental subjects play the traveler s dilemma in the gain and loss domain subjects cooperate substantially more over losses furthermore our results suggest that this treatment effect is best explained by reference dependent risk preferences and reference dependent strategic sophistication we discuss the implications of our results and relate our findings to other experimental games played in the loss domain

mnc subsidiary channel relationships as extended links implications of global strategies foreign subsidiaries of multinational corporations mncs rely on external partners such as channel partners to achieve global objectives we conceptualize the subsidiary s channel partner as an extended link of the mnc s internal network thus the subsidiary s adaptation and execution of the mnc s global strategies should influence the subsidiary s channel relationship and performance building on the strategy environment alignment framework we study the influence of mnc global strategies global efficiency multinational flexibility and worldwide learning on a subsidiary s channel commitment and the moderating influence of the host country environment survey data from german and japanese mncs in the united states indicate the importance of global strategies to a channel relationship for example we find that an emphasis on multinational flexibility is detrimental but worldwide learning benefits the subsidiary s channel commitment we also find that the host country environment plays a contingent role for example a global efficiency strategy is beneficial for channel commitment in a stable environment but detrimental in a dynamic environment our research offers key implications for mncs we suggest that when mncs decide to lay emphases on global strategies the mncs should consider not just their internal subsidiary network but also their extended channel partner links that function in foreign markets

optimism and pessimism in games this paper considers the impact of ambiguity in strategic situations it extends the earlier literature by allowing for optimistic responses to ambiguity ambiguity is modelled by ceu preferences we propose a new solution concept for players who may express ambiguitypreference then we study comparative statics of changes in ambiguity attitude in games with strategic complements this gives a precise statement of the impact of ambiguity on economic behaviour

experimental methods for the general economist five lessons from the lab i review five primary results from experimental economics that impact the economics profession as a whole these results regard the relative un importance of subject sophistication in laboratory markets the importance of gender on economic outcomes the propensity for humans to behave in less than fully rational ways the importance of trading institutions on economic performance and the behavioral relevance of economic theory i find that economics as a profession has benefited from the use of experimental methods by fostering a dialogue between theorists and empiricists better informing policy and improving data collection techniques

expectation based loss aversion and strategic interaction abstract by extending the equilibrium concepts of k szegi and rabin 2006 k szegi and rabin 2007 this paper analyzes the strategic interaction of expectation based loss averse players for loss averse players with choice acclimating expectations the utility from playing a mixed strategy is not linear but convex in the probabilities they assign to their pure strategies as a consequence they are generally unwilling to randomize and an equilibrium may fail to exist for players with choice unacclimating expectations by contrast randomizing over their pure strategies may indeed constitute a credible best response and an equilibrium always exists building upon these insights we delineate how expectation based loss averse players differ in their strategic behavior from their counterparts with standard expected utility preferences derive novel strategic effects discuss equilibrium selection and derive equilibrium play for some simple games

government payments and farm business survival using farm level panel data from recent u s agricultural censuses this study examines how direct government payments influence the survival of farm businesses paying particular attention to the differential effect of payments across farm size categories a cox proportional hazards model is used to estimate the effect of government payments on the instantaneous probability of a farm business failure controlling for farm and operator characteristics results indicate that an increase in government payments has a small but statistically significant negative effect on the rate of business failure and the magnitude of this effect increases with farm size

land accumulation dynamics in developing country agriculture abstractunderstanding land accumulation dynamics is relevant for policy makers interested in the economic effects of land inequality in developing country agriculture we thus explore and simultaneously test the leading theories of micro level land accumulation dynamics using unique panel data from paraguay the results suggest that farm growth varies systematically with farm size a formal rejection of stochastic growth theories that is gibrat s law and that titled land area may have considerable influence on land accumulation furthermore our estimates indicate that a dualistic agrarian structure is the likely product of the unfettered operation of land markets

theory and misbehavior of first price auctions recent experimental evidence appears to reject simple nash equilibrium models of bidding behavior in first price auctions the author presents a methodological critique of this evidence existing tests have concentrated on deviations of subjects from predictions in the message space of the action bid deviations the author suggests that it is more natural to evaluate subject behavior in expected payoff space he concludes that the evidence against the simple models is not significant enough to warrant their rejection copyright 1989 by american economic association

adjusting to and learning from institutional diversity toward a capability building perspective this paper identifies two main dimensions institutional diversity and dynamism in the research stream that has substantively engaged with the important contribution of jackson and deeg j int bus stud 39 4 540 561 2008 taking into account their core criticism that institutional analysis in international business research is often de contextualized and building on these two dimensions we present two possible paths for institutional analysis that are sensitive to context the first is a methodological shift towards configurational analyses and specifically the analysis of counterfactual scenarios that could reveal new information about decision alternatives the second is a shift away from a focus on costs and towards the possibility of mnes building capabilities in an exploratory manner when confronted with institutional diversity both approaches build on an understanding of mnes as strategic actors that co evolve with their environments

short run returns to scale farm size and economic efficiency this paper analyzes the effects of returns to scale farm size technical allocative and scale inefficiencies on the profitability of utah dairy farms it derives the conditions necessary to compare the profitability of farms within and between different size classifications as small medium and large some comparative static results regarding increases in input prices and a decrease or withdrawal of price support on profitability of small medium and large farms are presented copyright 1993 by mit press