Decision Making & Negotiations

The adoption and diffusion of new products and behaviors has been studied extensively and comprehensively (e.g., Rogers 2003). Disadoption — how and why people volitionally stop using products and/or cease certain behaviors (e.g., customer defection, smoking cessation) — by contrast, has received less and more situation-specific attention. This paper presents a general (conceptual) framework for understanding disadoption. Disadoption is defined and delineated from other behavioral discontinuances.

In many auctions, buyers are represented by an intermediary that manages their bidding process, along with that of other buyers. Notably, this is prevalent in the real-time online display advertising market, in which advertisers bid for impressions through intermediaries called demand side platforms (DSPs). In turn, intermediaries, when bidding on behalf of their customers, strategize to maximize some internal objective and may only submit a single bid to limit competition on a given item.

Whether in everyday disagreements, bargaining episodes, or high-stakes disputes, people typically see a spectrum of possible responses to dealing with differences with others, ranging from avoidance and accommodation to competition and aggression. We believe people judge their own and others' behaviors along this dimension, which we call interpersonal assertiveness, reflecting the degree to which someone stands up and speaks out for their own positions when they are faced with someone else who does not want the same outcomes.

Uncertainty is an unavoidable part of human life. How do states of uncertainty influence the way people make decisions? We advance the proposition that states of uncertainty increase the reliance on affective inputs in judgments and decisions. In accord with this proposition, results from six studies show that the priming of uncertainty (vs. certainty) consistently increases the effects of a variety of affective inputs on consumers' judgments and decisions.

We evaluate the effects of the 2009 Home Affordable Modification Program (HAMP) that provided intermediaries with sizeable financial incentives to renegotiate mortgages. HAMP increased intensity of renegotiations and prevented substantial number of foreclosures but reached just one-third of its targeted indebted households. This shortfall was in large part due to low renegotiation intensity of a few large intermediaries and was driven by intermediary-specific factors.

To align employees' interests with the firm's goals, employers often use performance-based pay, but designing such a compensation plan is challenging because performance is typically multifaceted. For example, a sales employee should be incentivized to sell the company's product, but a focus on current sales without rewarding the salespeople according to the quality of the product and/or customer service may result in fewer future sales.

This study incorporates a recent preference specification of expectations-based loss aversion, which has been applied broadly in microeconomics, into a classic macro model to offer a unified explanation for three empirical observations about life-cycle consumption. First, loss aversion explains excess smoothness and sensitivity — that is, the empirical observation that consumption responds to income shocks with a lag. Intuitively, such lagged responses allow the agent to delay painful losses in consumption until his expectations have adjusted.

The present research considered what leads perceivers to evaluate someone as a good or poor judge of people. In general, we found a substantial role for agreement: perceivers evaluated another person as a good judge when he or she agreed with their perception of someone's characteristics. Importantly, the effect of agreement depended on who this " someone" was. We found that perceivers' evaluation of another individual as a good judge was more heavily shaped by agreement about their own characteristics than by agreement about a third-party target's characteristics.

We study the efficient resolution of global banks by national regulators. Single-point-of-entry (SPOE) resolution, where loss-absorbing capacity is shared across jurisdictions, is efficient in principle, but may not be implementable. First, when expected transfers across jurisdictions are too asymmetric, national regulators fail to set up an efficient SPOE resolution regime ex ante. Second, when required ex-post transfers across jurisdictions are too large, national regulators ring-fence local banking assets instead of cooperating in a planned SPOE resolution.