In: Journal of Economic Behavior & Organization, 2020, vol. 177, p. 836-857
Research in criminology has shown that the perceived risk of apprehension often differs substantially from the true level. To incorporate this insight, we extend the standard economic model of law enforcement (Becker, 1968) by considering two types of offenders, sophisticates and naïves. Sophisticates always fully take the actual enforcement effort into account, while naïves do so only when the...
|
In: Journal of sports economics, 2016, vol. 17, no. 8, p. 767-789
Customers who boycott an organization after some scandal may actually exacerbate the fraud problem they would like to prevent. This conclusion is derived from a game- theoretic model that introduces a third player into the standard inspection game. Focusing on the example of doping in professional sports, we observe that doping is prevalent in equilibrium because customers undermine an...
|
In: Social Choice and Welfare, 2014, vol. 42, no. 3, p. 735-750
We characterize the outcome of majority voting for single-peaked preferences on median spaces. This large class of preferences covers a variety of multi-dimensional policy spaces including products of lines (e.g. grids), trees, and hypercubes. Our main result is the following: If a Condorcet winner (i.e. a winner in pairwise majority voting) exists, then it coincides with the appropriately...
|
In: European Journal of Operational Research, 2015, vol. 240, no. 2, p. 505-517
In the framework of spatial competition, two or more players strategically choose a location in order to attract consumers. It is assumed standardly that consumers with the same favorite location fully agree on the ranking of all possible locations. To investigate the necessity of this questionable and restrictive assumption, we model heterogeneity in consumers’ distance perceptions by...
|
In: Journal of economic dynamics and control, 2015, vol. 52, p. 240-257
We study a dynamic model of opinion formation in social networks. In our model, boundedly rational agents update opinions by averaging over their neighbors’ expressed opinions, but may misrepresent their own opinion by conforming or counter-conforming with their neighbors. We show that an agent׳s social influence on the long-run group opinion is increasing in network centrality and...
|
In: Journal of economic behavior and organization, 2018, vol. 155, p. 301-314
Successful performance – be it in school, at the job, or in sports activities – requires perseverance, i.e., persistent work on a demanding task. We investigate in a controlled laboratory experiment how an individual's social environment affects perseverance. We find evidence for two kinds of peer effects: being observed by a peer can postpone the decision to give up, while observing a...
|
In: Games and economic behavior, 2019, vol. 118, p. 241-268
We study communication in social networks prior to a majority vote on two alternative policies. Some agents receive a private imperfect signal about which policy is correct. They can recommend a policy to their neighbors in the social network prior to the vote. We show theoretically and empirically that communication can undermine efficiency and hence reduce welfare in a common-interest...
|
In: Experimental economics, 2019, p. 1-35
We investigate how the selection process of a leader affects team performance with respect to social learning. We use a laboratory experiment in which an incentivized guessing task is repeated in a star network with the leader at the center. Leader selection is either based on competence, on self-confidence, or made at random. In our setting, teams with random leaders do not underperform....
|
In: Homo economicus, 2016, vol. 33, no. 1-2, p. 157-172
Despite the rich stream of research that evolved from Hotelling’s spatial competition model, the fact that firms’ strategies are constrained by their technological capabilities, the legal environment, or overriding corporate strategies is commonly neglected. We study a model of Hotelling–Downs competition in which two firms choose a position along a one-dimensional market given that...
|
In: Journal of economic theory, 2014, vol. 154, p. 274-309
We consider an overlapping generations model where continuous cultural traits are transmitted from an adult generation to the children. A weighted social network describes how children are influenced not only by their parents but also by other role models within the society. Parents can invest into the purposeful socialization of their children by strategically displaying a cultural trait...
|
