Economics Insights @ CBS

We consider a Markovian model of a multiclass queueing system in which a single large pool of servers attends to the various customer classes. Customers waiting to be served may abandon the queue, and there is a cost penalty associated with such abandonments. Service rates, abandonment rates, and abandonment penalties are generally different for the different classes. The problem studied is that of dynamically scheduling the various classes.

In recent years there have been enormous changes in our technology, our economy, and our society. But has there been progress? From most economists the first reaction to this question is: Of course there must have been progress! After all, the growth of new technologies expands opportunity sets, what we can do, the amount of output per unit input. We can choose either to have more output, more goods and services, or to work less. However we make the choice, surely we are better off. But what, then, about the sweeping changes we associate with the phenomenon of globalization?

Negotiation scholars and practitioners have long noted the impact of face, or social image, concerns on negotiation outcomes. When face is threatened, negotiators are less likely to reach agreement and to create joint gain. In this paper, we explore individual differences in face threat sensitivity (FTS), and how a negotiator's role moderates the relationship of his or her FTS to negotiation outcomes. Study 1 describes a measure of FTS. Study 2 finds that buyers and sellers are less likely to reach an agreement that is in both parties' interests when the seller has high FTS.

Research on new product launches has focused on improving the initial go/no-go decision to reduce the probability of post-launch failure. However, early-period assessments are hampered by a lack of data to enable further prediction—the few periods of aggregate sales data available to marketers are not enough on which to base reliable predictions.

Everyone who has studied international equity returns has noticed the episodes of high volatility and unusually high correlations coinciding with a bear market. We develop quantitative models of asset returns that match these patterns in the data and use them in two quantitative asset allocation analyses. First, we show that the presence of regimes with different correlations and expected returns is difficult to exploit with within a global asset allocation framework focussed on equities. The benefits of international diversification dominate the costs of ignoring the regimes.