We propose an analytically tractable continuous-time model of experimentation in which a risk-averse entrepreneur cannot fully diversify the idiosyncratic risk from his business investment. He makes consumption/savings and business exit decisions jointly, while learning about the unknown quality of the project over time.
This research addresses refutation of false beliefs formed on the basis of repeated exposure to advertisements. Experiment 1 explores belief in the refutation as a function of the perceptual details shared (alignment) between the claim and the refutation as manipulated by whether the original claim was direct (assertion) or indirect (implication). Experiment 2 then examines whether this effect will carry through to belief in the original claim after exposure to the refutation. Findings indicate that direct refutations of indirect claims are believed more than refutations of direct claims.
We investigated two types of metaphors in stock market commentary. Agent metaphors describe price trajectories as volitional actions, whereas object metaphors describe them as movements of inanimate objects. Study 1 examined the consequences of commentators? metaphors for their investor audience. Agent metaphors, compared with object metaphors and non-metaphoric descriptions, caused investors to expect price trend continuance. The remaining studies examined preconditions, the features of a price trend that evoke agent vs. object metaphors.
In most marketing experiments, managerial decisions are not based directly on the estimates of the parameters, but rather on functions of these estimates. For example, many managerial decisions are driven by whether or not a feature is valued more than the price the consumer will be asked to pay. In other cases, some managerial decisions are weighed more heavily than others. The standard measures used to evaluate experimental designs (e.g., A-efficiency or D-efficiency) do not accommodate these phenomena.
Polyhedral methods for choice-based conjoint analysis provide a means to adapt choice-based questions at the individual-respondent level and provide an alternative means to estimate partworths when there are relatively few questions per respondent as in a web-based questionnaire. However, these methods are deterministic and are susceptible to the propagation of response errors. They also assume, implicitly, a uniform prior on the partworths.
The relation between emotion and rationality is assessed by reviewing empirical findings from multiple disciplines. Two types of emotional phenomena are examined—incidental emotional states and integral emotional responses—and three conceptions of rationality are considered—logical, material, and ecological. Emotional states influence reasoning processes, are often misattributed to focal objects, distort beliefs in an assimilative fashion, disrupt self-control when intensely negative but do not necessarily increase risk-taking.
We integrate the financial architecture into the theory of investment by building on two strands of literature: irreversible investment and debt pricing/capital structure. We extend the real options approach to investment, pioneered by Michael J. Brennan and Eduardo S. Schwartz (1985) and Robert McDonald and Daniel Siegel (1986), to allow for capital structure decisions under strategic debt service. We also draw insights from corporate debt pricing/capital structure literature, which focuses on leverage and security pricing after investment has already been made (Robert C.
We propose and test a new approach for modeling consumer heterogeneity in conjoint estimation based on convex optimization and statistical machine learning. We develop methods both for metric and choice data. Like hierarchical Bayes (HB), our methods shrink individual-level partworth estimates towards a population mean. However, while HB samples from a posterior distribution that is influenced by exogenous parameters (the parameters of the second-stage priors), we minimize a convex loss function that depends only on endogenous parameters.
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