Findings

Branded

Kevin Lewis

May 14, 2019

Collectives in organizations appear less morally motivated than individuals
Arthur Jago, Tamar Kreps & Kristin Laurin
Journal of Experimental Psychology: General, forthcoming

Abstract:

Organizations often benefit from signaling moral values. Across 5 studies, we explore how people attribute moral conviction to different organizational agents. We find that people believe collectives (e.g., groups; entire organizations) have less moral conviction than individuals, even when both agents behave identically (Studies 1 and 2). We test a variety of potential mechanisms for this effect, and find evidence for two parallel pathways: first, people believe collectives have less of a capacity for emotional experience, and therefore are less likely to use emotions when making decisions; and second, people believe collectives are also more self-interested, and therefore more likely to behave out of concern for their reputations rather than morality (Study 3). In examining boundary conditions for this effect, we find that it occurs when people judge generic for-profit companies and government entities, but not family businesses or charities (Study 4). Finally, we demonstrate that, because collectives appear less morally motivated than individuals, people also assume collectives will exhibit less persistence after enacting prosocial initiatives (Study 5). We discuss theoretical, practical, and social implications of these differing attributions of moral conviction.


Market Reactions to Non‐Market Strategy: The Signaling Role of Congressional Testimony
Jason Ridge et al.
Strategic Management Journal, forthcoming

Abstract:

We argue that because influence in the political arena can net benefits for firms, investors will respond favorably to indications of firm political influence. We focus on testimony before Congress because it is one of the most highly sought after and influential points of governmental access. Our findings indicate that firms reap positive abnormal returns surrounding Congressional testimony and that investors respond more favorably to aspects of testimony that indicate additional political influence (i.e., witness status, testimony length, and committee jurisdiction). Further, we find regulatory risk strengthens the effect of witness status and testimony length while Congressional negativity strengthens the effect of witness status. Taken together, our results suggest that investors respond favorably to indications that firms have influence in the political arena.


Internalizing production costs and changes of tastes: More recent theatre plays feature fewer roles
Sacit Hadi Akdede, Victor Ginsburgh & Aynur Uçkaç
Social Science Journal, forthcoming

Abstract:

This paper shows that the number of roles in theatre plays has decreased over time. Playwrights seem to internalize the costs of producing plays by downsizing the number of roles. This downsizing is not a recent phenomenon: it already started a long time ago. This is not surprising, since production costs increase over time and the Baumol cost disease is obviously one of the reasons, though one cannot exclude that fashion has changed given the time elapsed between William Shakespeare and Samuel Beckett.


How Rupert Murdoch Outfoxed Larry Tisch: Ten Enduring Lessons from the Negotiations that Wrested the NFL from CBS
James Sebenius
Harvard Working Paper, March 2019

Abstract:

A remarkable 1993 negotiation rocked the world of American football with aftershocks that have directly shaped today’s entertainment and media landscapes and even our polarized politics. In December of that year, Rupert Murdoch’s fledgling Fox Network unexpectedly displaced longtime incumbent CBS as the host of the National Football League’s flagship programming. Fox’s negotiating success seemed most unlikely given that CBS had regularly renewed these NFL rights since 1956, enjoyed a good relationship with the NFL, sported an acclaimed broadcast unit, and had affiliates in virtually all important U.S. markets. Yet acquisition of these NFL rights directly enabled the expansion of Fox, then a minor broadcaster, into the media behemoth of today. For many observers, Fox’s NFL “heist” looked like the result of a simple move: Fox offered more money than CBS. A closer analysis, however, suggests a far more complex reality with ten broader lessons for negotiators facing challenging situations.


Don't Judge a Wine by Its Closure: Price Premiums for Corks in the U.S. Wine Market
Anton Bekkerman & Gary Brester
Journal of Wine Economics, February 2019, Pages 3-25

Abstract:

For many purchases, consumers often possess only limited information about product quality. Thus, observable product characteristics are used to determine expected quality levels when making purchase decisions. We use more than 1 million weekly scanner-level observations from grocery stores across ten U.S. markets between September 2009 and August 2012 to examine how consumers value a wine bottle's closure type (i.e., cork or screw cap). We focus on lower-priced wines — those with sale prices less than $30 per 750 milliliter bottle — to more accurately evaluate decisions of consumers for whom seeking additional information about wine quality is likely more costly than the benefits derived from that information. Using both pooled ordinary least squares and quantile regressions to estimate price premiums for bottles with corks or screw caps, we find that U.S. consumers are willing to pay, on average, approximately 8% more (about $1.00) for a bottle of wine that has a cork closure. In addition, we show that the size of this premium increases as wine prices decline.


The Effect of ID Verification in Online Markets: Evidence from a Field Experiment
Jeffrey Livingston & Patrick Scholten
Review of Industrial Organization, May 2019, Pages 595–615

Abstract:

eBay’s ID Verify program, which allowed sellers to pay a fee to have their identity confirmed by a credit information company, was designed to alleviate asymmetric information problems in online auctions. We conduct a field experiment where items are sold on eBay by one of four identities that either are or are not ID verified and have either a good or no reputation. We find that ID verification increases the number of bids placed but has no impact on the level of the winning bid, and may even lower the winning bid among sellers who have good reputations.


Can Joy Buy You Money? The Impact of the Strength, Duration, and Phases of an Entrepreneur’s Peak Displayed Joy on Funding Performance
Lin Jiang, Dezhi Yin & Dong Liu
Academy of Management Journal, forthcoming

Abstract:

Does displaying positive emotions (e.g., joy) during a funding pitch help an entrepreneur gain more financial support? Past research has approached this question mostly by treating emotional displays as static and focusing on the overall or average levels of displayed emotions. However, emotional displays are temporally dynamic and more salient in some moments or phases. Drawing from gestalt characteristics and event system theories, we take a dynamic approach to examine the “peak” moments of entrepreneurs’ displayed joy — specifically, the strength and duration of peak displayed joy during different phases of a pitch. We analyzed data from over 8 million frames in 1,460 pitch videos, using the latest facial expression analysis technique. The findings unveil the benefit of pitching with a greater level of peak displayed joy, especially during the beginning and ending phases of a pitch. Moreover, the amount of time an entrepreneur spends at the peak level of his or her displayed joy has an inverted U-shape relationship with funding performance. This research highlights not only the importance of investigating emotion temporal dynamics in the interpersonal context, but also the unique research opportunities provided by facial expression analyses in understanding complex management phenomena.


Competitive Dynamics in the Sharing Economy: An Analysis in the Context of Airbnb and Hotels
Hui Li & Kannan Srinivasan
Marketing Science, forthcoming

Abstract:

The entry of flexible-capacity sharing economy platforms (e.g., Airbnb and Uber) has potentially changed the competitive landscape in traditional industries with fixed-capacity incumbents and volatile demand. Leveraging panel data on hotels and Airbnb, we study how the sharing economy fundamentally changes the way the industry accommodates demand fluctuations and how incumbent firms should strategically respond. The demand estimates suggest that Airbnb’s flexible supply helps recover the lost underlying demand due to hotel seasonal pricing (i.e., higher prices during high-demand seasons) and even stimulates more demand in some cities. The counterfactual results suggest that some hotel types in some cities may benefit from conducting less seasonal pricing and even considering counter-seasonal pricing. Market conditions (e.g., seasonality patterns, hotel prices and quality, consumer composition, and Airbnb supply elasticity) play a crucial role in determining the impact of Airbnb on hotel sales and hotels’ strategic response. Finally, recent Airbnb and policy changes (e.g., higher Airbnb hosting costs due to hotel taxes or lower Airbnb hosting costs due to third-party services and the “professionalism” of hosts) affect the competitive dynamics. The profits of high-end hotels are the most sensitive to the changes in Airbnb hosting costs. Airbnb’s recent attempt to behave more like hotels can increase hotels’ vulnerability to lower Airbnb hosting costs.


Charities Can Increase the Effectiveness of Donation Appeals by Using a Morally Congruent Positive Emotion
Shreyans Goenka & Stijn van Osselaer
Journal of Consumer Research, forthcoming

Abstract:

Prosocial organizations have different moral objectives. Some seek to promote welfare (e.g., Red Cross), but others seek to promote justice and equality (e.g., ACLU). Additionally, these organizations can induce different positive emotions to motivate donations. If organizations are seeking to promote different moral objectives using positive emotions, which positive emotion will be the most effective for their respective campaigns? We demonstrate how the congruency between the moral domain of an emotion and the moral objective of an organization plays a role in influencing prosocial behaviors. Charities that seek to increase care in society (e.g., disaster-relief charities) should utilize compassion in their promotion campaigns, but charities that seek to promote fairness and equality in society (e.g., human rights charities) should utilize gratitude in their promotion campaigns. One field study (N = 2,112) and four experiments (N = 2,100) demonstrate that utilizing a positive emotion congruent with the charity’s moral objective increases monetary donations and preferences. The preferences are driven by the moral concerns made salient by the respective emotions. Further, the preferences attenuate when exchange norms are made salient. Altogether, these results underscore the importance of considering moral congruence in consumption contexts.


A Comparison of Approaches to Advertising Measurement: Evidence from Big Field Experiments at Facebook
Brett Gordon et al.
Marketing Science, March-April 2019, Pages 193–225

Abstract:

Measuring the causal effects of digital advertising remains challenging despite the availability of granular data. Unobservable factors make exposure endogenous, and advertising’s effect on outcomes tends to be small. In principle, these concerns could be addressed using randomized controlled trials (RCTs). In practice, few online ad campaigns rely on RCTs and instead use observational methods to estimate ad effects. We assess empirically whether the variation in data typically available in the advertising industry enables observational methods to recover the causal effects of online advertising. Using data from 15 U.S. advertising experiments at Facebook comprising 500 million user-experiment observations and 1.6 billion ad impressions, we contrast the experimental results to those obtained from multiple observational models. The observational methods often fail to produce the same effects as the randomized experiments, even after conditioning on extensive demographic and behavioral variables. In our setting, advances in causal inference methods do not allow us to isolate the exogenous variation needed to estimate the treatment effects. We also characterize the incremental explanatory power our data would require to enable observational methods to successfully measure advertising effects. Our findings suggest that commonly used observational approaches based on the data usually available in the industry often fail to accurately measure the true effect of advertising.


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