Contributions published at Department of Business Administration (Egon Franck)

This paper develops a duopoly model for user-generated content (UGC) platforms, which compete for consumers and content producers in two-sided markets characterized by network externalities. Each platform has the option to invest in a content quality assurance (CQA) system and determine the level of advertising. Our model reveals that network effects are pivotal in shaping the platforms’ optimal strategies and user behavior, specifically in terms of single vs. multi-homing. We find that when network effects for producers are weak, consumers tend to engage in multi-homing while producers prefer single-homing. Conversely, strong network effects lead to the opposite behavior. Furthermore, our model demonstrates that user behavior and network effects dictate whether a platform is incentivized to incorporate advertisements and/or invest in CQA. Generally, weak network effects prompt a platform to invest in a CQA system, unless both consumers and producers engage in multi-homing. Our model’s results highlight the importance for platform companies to evaluate the extent of network effects on their platform in order to anticipate user behavior, which subsequently informs the optimal CQA and advertising strategy.

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Endogeneity is a common problem in any causal analysis. It arises when the independence assumption between an explanatory variable and the error in a statistical model is violated. The causes of endogeneity are manifold and include response bias in surveys, omission of important explanatory variables, or simultaneity between explanatory and response variables. Instrumental variable estimation provides a possible solution. However, valid and strong external instruments are difficult to find. Consequently, internal instrumental variable approaches have been proposed to correct for endogeneity without relying on external instruments. The R package REndo implements various internal instrumental variable approaches, i.e., latent instrumental variables estimation (Ebbes, Wedel, Boeckenholt, and Steerneman 2005), higher moments estimation (Lewbel 1997), heteroscedastic error estimation (Lewbel 2012), joint estimation using copula (Park and Gupta 2012) and multilevel generalized method of moments estimation (Kim and Frees 2007). Package usage is illustrated on simulated and real-world data.

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We draw on group information-processing theory to investigate how target boards of directors may contribute to target value capture during the private negotiations phase in acquisitions. We view target boards as information-processing groups and private negotiations as information-processing tasks. We argue that target board meeting frequency is associated with increased processing—gathering, sharing, and analyzing—of acquisition-related information, which improves target bargaining and, ultimately, target value capture. We further posit that this value-enhancing effect of target board meeting frequency is more pronounced when target board composition improves the ability of target boards to process acquisition-related information. Finally, we expect that meeting frequency is more consequential for target bargaining and value capture when acquisition complexity imposes high information-processing demands on the target boards during private negotiations. Empirical evidence from a sample of acquisitions of publicly listed firms in the United States offers support for our group information-processing perspective on board contribution to shareholder value in firms targeted for acquisition.

The paper is devoted to the calmness from below/from above for the optimal value function of parametric optimization problems, where we are specifically interested in perturbed semi-infinite programs. A main intention is to revisit classical results and to derive refinements of them. In particular, we show in the context of semi-infinite optimization that calmness from below for j holds under quasiconvexity of the data functions and compactness of the solution set, which extends results on the lower semicontinuity of Illustrative examples are given, which demonstrate the significance of the imposed assumptions even in the case of linear and quadratic programs.

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In a national sample of 5087 Spaniards, we examine the prevalence of 10 specific misperceptions over five separate science and health domains (climate change, 5G technology, genetically modified foods, vaccines, and homeopathy). We find that misperceptions about genetically modified foods and general health risks of 5G technology are particularly widespread. While we find that partisan affiliation is not strongly associated with any of the misperceptions aside from climate change, we find that two distinct dimensions of an anti-elite worldview—anti-expert and conspiratorial mindsets—are better overall predictors of having science and health misperceptions in the Spanish context. These findings help extend our understanding of polarization around science beyond the most common contexts (e.g. the United States) and support recent work suggesting anti-elite sentiments are among the most important predictors of factual misperceptions.

Welzel et al. (2021) claim that non-invariance of instruments is inconclusive and inconsequential in the field for cross-cultural value measurement. In this response, we contend that several key arguments on which Welzel et al. (2021) base their critique of invariance testing are conceptually and statistically incorrect. First, Welzel et al. (2021) claim that value measurement follows a formative rather than reflective logic. Yet they do not provide sufficient theoretical arguments for this conceptualization, nor do they discuss the disadvantages of this approach for validation of instruments. Second, their claim that strong inter-item correlations cannot be retrieved when means are close to the endpoint of scales ignores the existence of factor-analytic approaches for ordered-categorical indicators. Third, Welzel et al. (2021) propose that rather than of relying on invariance tests, comparability can be assessed by studying the connection with theoretically related constructs. However, their proposal ignores that external validation through nomological linkages hinges on the assumption of comparability. By means of two examples, we illustrate that violating the assumptions of measurement invariance can distort conclusions substantially. Following the advice of Welzel et al. (2021) implies discarding a tool that has proven to be very useful for comparativists.

We suggest a novel choice of non-separable basis functions for an approximate linear programming approach to the well-known network revenue management problem. Considering non-separability is particularly important when interdependencies between resources are large. Such a situation can be illustrated for example by a bus line, where different origin-destination pairs have many overlapping segments. Traditional separable approximation approaches tend to ignore the resulting interactions. We suggest to group resources into non-separable subnetworks. For each chosen subnetwork, basis functions either span the whole function space or consist of linear functions. Given this more general choice of basis functions, we extend existing reductions of approximate linear programs. If there is only one subnetwork, for which the basis functions span the whole function space, we prove the equivalence to a compact linear program of polynomial size. For the general case, we suggest an approximate reduction. Numerical examples illustrate our novel upper bounds for the maximum expected revenue and the corresponding competitive policies. In particular, we find that the added benefit of non-separability heavily depends on the network structure and the capacity. Our work helps to better understand the impact of assuming separability in network revenue management. The polynomial sized reductions make it possible to estimate the added average revenue resulting from incorporating interactions between resources. The theory we develop demonstrates how the interpretation of dual variables as state-action probabilities can be applied to reduce exponentially large approximate linear programs via variable aggregation.

We propose a model of basic self-regulatory mechanisms that integrates descriptive-structural and dynamic-explanatory approaches to personality. Using a structural way of thinking and based on a structural model of personality (the Circumplex of Personality Metatraits), we deduced two orthogonal (distinct) but interactive mechanisms: (a) Impulse Control responsible for controlling automatically activated impulses, urges, and affective reactions and (b) Self-Motivation responsible for regulating intentions in goal-oriented behaviors. Their operation depends on both situational and dispositional factors and optimal functioning of both mechanisms is needed for effective regulation of behavior. People can also be characterized by relatively stable levels of Impulse Control and Self-Motivation as dispositions, which depend on temperamental predispositions but can develop incoherently with them due to the impact of environmental factors. Combinations of Impulse Control and Self-Motivation as dispositions result in personality types, which differ in their adaptiveness. Importantly, Impulse Control and Self-Motivation mechanisms reveal substantial similarities to other self-regulatory constructs described in the literature, particularly those included in Block and Block's as well as Kuhl's theories. The contribution of our paper may serve as an example of how to apply the descriptive-structural approach to develop a dynamic-explanatory model of personality.

Previous explanations regarding transnational solidarity in the European Union (EU) have mainly focussed on factors including left–right self‐placement, support for European integration and European identity. We expand this model by considering deeper psychological determinants of transnational solidarity: values, operationalised as Schwartz's basic human values of universalism and security. We expect them to exert (1) direct effects on transnational solidarity – measured as support for pan‐European social benefits – and (2) indirect effects via the three aforementioned factors. We test and find evidence to support our theoretical framework using multigroup structural equation modelling and data from the European Social Survey. We further show that the effect size of the value of universalism on preferences for an EU social benefit scheme in each country is positively moderated by that country's net contribution to the EU budget, highlighting the interaction between material interests and psychological value motivations.

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