Mere observation of others' choices can be informative about product quality. This paper develops an individual-level dynamic model of observational learning and applies it to a novel data set from ...the U.S. kidney market, where transplant candidates on a waiting list sequentially decide whether to accept a kidney offer. We find strong evidence of observational learning: patients draw negative quality inferences from earlier refusals in the queue, thus becoming more inclined towards refusal themselves. This self-reinforcing chain of inferences leads to poor kidney utilization despite the continual shortage in kidney supply. Counterfactual policy simulations show that patients would have made more efficient use of kidneys had the concerns behind earlier refusals been shared. This study yields a set of marketing implications. In particular, we show that observational learning and information sharing shape consumer choices in markedly different ways. Optimal marketing strategies should take into account how consumers learn from others.
Microloan markets allow individual borrowers to raise funding from multiple individual lenders. We use a unique panel data set that tracks the funding dynamics of borrower listings on Prosper.com, ...the largest microloan market in the United States. We find evidence of rational herding among lenders. Well-funded borrower listings tend to attract more funding after we control for unobserved listing heterogeneity and payoff externalities. Moreover, instead of passively mimicking their peers (irrational herding), lenders engage in active observational learning (rational herding); they infer the creditworthiness of borrowers by observing peer lending decisions and use publicly observable borrower characteristics to moderate their inferences. Counterintuitively, obvious defects (e.g., poor credit grades) amplify a listing's herding momentum, as lenders infer superior creditworthiness to justify the herd. Similarly, favorable borrower characteristics (e.g., friend endorsements) weaken the herding effect, as lenders attribute herding to these observable merits. Follow-up analysis shows that rational herding beats irrational herding in predicting loan performance.
This paper was accepted by Pradeep Chintagunta, marketing.
"Behavior-based personalization" has gained popularity in recent years, whereby businesses offer personalized products based on consumers' purchase histories. This paper highlights two perils of ...behavior-based personalization in competitive markets. First, although purchase histories reveal consumer preferences, competitive exploitation of such information damages differentiation, similar to the classic finding that behavior-based price discrimination intensifies price competition. With endogenous product design, there is yet a second peril. It emerges when forward-looking firms try to avoid the first peril by suppressing the information value of purchase histories. Ideally, if a market leader serves all consumers on day 1, purchase histories contain no information about consumer preferences. However, knowing that their rivals are willing to accommodate a market leader, firms are more likely to offer a mainstream design at day 1, which jeopardizes differentiation. Based on this understanding, I investigate how the perils of behavior-based personalization change under alternative market conditions, such as firms' better knowledge about their own customers, consumer loyalty and inertia, consumer self-selection, and the need for classic designs.
Microplastics are widespread in freshwater environments, their biological effects and combined effects of other pollutants have attracted extensive attention. In this study, we investigated the ...adsorption properties of heavy metals onto polystyrene (PS) microplastics as well as the bioavailability and toxicity of microplastics and heavy metals by hydroponic wheat seedlings experiment. Results showed that PS microplastics (0.5 µm, 100 mg/L) had no significant effect on wheat seedlings growth, photosynthesis, and reactive oxygen species (ROS) content. However, PS microplastics could adsorb copper and cadmium, with a predominantly chemisorption. The accumulation of copper and cadmium in wheat seedlings reduced in the presence of PS microplastics, which meant the toxic effect by heavy metals might be mitigated. Compared with single heavy metals treatments, the combination of PS microplastics and heavy metals increased chlorophyll content, enhanced photosynthesis and reduced the accumulation of ROS. These findings suggest that PS microplastics (0.5 µm, 100 mg/L) have a mitigating effect on the bioavailability and toxicity of copper and cadmium.
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•PS microplastics (0.5 μm, 100 mg/L) had no significant effect on wheat seedlings.•Adsorption kinetics of Cu2+ and Cd2+ onto PS microplastics were fitted well by the pseudo-second-order model.•The accumulation of metals in wheat seedlings decreased by the presence of PS microplastics.•PS microplastics had a mitigating effect on the toxicity of copper and cadmium.
Intense nonpharmaceutical interventions were put in place in China to stop transmission of the novel coronavirus disease 2019 (COVID-19). As transmission intensifies in other countries, the interplay ...between age, contact patterns, social distancing, susceptibility to infection, and COVID-19 dynamics remains unclear. To answer these questions, we analyze contact survey data for Wuhan and Shanghai before and during the outbreak and contact-tracing information from Hunan province. Daily contacts were reduced seven- to eightfold during the COVID-19 social distancing period, with most interactions restricted to the household. We find that children 0 to 14 years of age are less susceptible to severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) infection than adults 15 to 64 years of age (odds ratio 0.34, 95% confidence interval 0.24 to 0.49), whereas individuals more than 65 years of age are more susceptible to infection (odds ratio 1.47, 95% confidence interval 1.12 to 1.92). Based on these data, we built a transmission model to study the impact of social distancing and school closure on transmission. We find that social distancing alone, as implemented in China during the outbreak, is sufficient to control COVID-19. Although proactive school closures cannot interrupt transmission on their own, they can reduce peak incidence by 40 to 60% and delay the epidemic.
The format of pricing contracts varies substantially across business contexts, a major variable being whether a contract imposes a fixed fee payment. This paper examines how the use of the fixed fee ...in pricing contracts affects market outcomes of a manufacturer-retailer channel. Standard economic theories predict that channel efficiency increases with the introduction of the fixed fee and is invariant to its framing. We conduct a laboratory experiment to test these predictions. Surprisingly, the introduction of the fixed fee fails to increase channel efficiency. Moreover, the framing of the fixed fee does make a difference: an opaque frame as quantity discounts achieves higher channel efficiency than a salient frame as a two-part tariff, although these two contractual formats are theoretically equivalent.
To account for these anomalies, we generalize the standard economic model by allowing the retailer's utilities to be reference dependent so that the up-front fixed fee payment is perceived as a loss and the subsequent retail profits as a gain. We embed this reference-dependent utility function in a quantal response equilibrium framework where the retailer is allowed to make decision mistakes due to computational complexity. The key prediction of this behavioral model is that channel efficiency decreases with loss aversion for sufficiently Nash-rational retailers. Consistent with this prediction, the estimated loss-aversion coefficient is 1.37 in the two-part tariff condition, significantly higher than 1.27 in the quantity discount condition. At the same time, loss aversion dominates contract complexity in explaining the data. Lastly, we conduct a follow-up experiment to confirm the central role of loss aversion as a behavioral driver. In one condition, the retailer becomes less loss averse when we temporally compress the fixed fee payment and the realization of retail profits, which supports the loss aversion theory. In the other condition, the retailer's contract acceptance rate does not decline when we reward the manufacturer a higher cash payment for each experimental point earned, which rules out the competing hypothesis that the retailer rejects contract offers due to fairness concerns.
Popularity information is usually thought to reinforce existing sales trends by encouraging customers to flock to mainstream products with broad appeal. We suggest a countervailing market force: ...popularity information may benefit niche products with narrow appeal disproportionately, because the same level of popularity implies higher quality for narrow-appeal products than for broad-appeal products. We examine this hypothesis empirically using field experiment data from a website that lists wedding service vendors. Our findings are consistent with this hypothesis: narrow-appeal vendors receive more visits than equally popular broad-appeal vendors after the introduction of popularity information.
This paper was accepted by Pradeep Chintagunta, marketing.
Exoskeletons and active prostheses promise to enhance human mobility, but few have succeeded. Optimizing device characteristics on the basis of measured human performance could lead to improved ...designs. We have developed a method for identifying the exoskeleton assistance that minimizes human energy cost during walking. Optimized torque patterns from an exoskeleton worn on one ankle reduced metabolic energy consumption by 24.2 ± 7.4% compared to no torque. The approach was effective with exoskeletons worn on one or both ankles, during a variety of walking conditions, during running, and when optimizing muscle activity. Finding a good generic assistance pattern, customizing it to individual needs, and helping users learn to take advantage of the device all contributed to improved economy. Optimization methods with these features can substantially improve performance.
The dysfunction of the renin-angiotensin system (RAS) has been observed in coronavirus infection disease (COVID-19) patients, but whether RAS inhibitors, such as angiotensin-converting enzyme ...inhibitors (ACEIs) and angiotensin II type 1 receptor blockers (ARBs), are associated with clinical outcomes remains unknown. COVID-19 patients with hypertension were enrolled to evaluate the effect of RAS inhibitors. We observed that patients receiving ACEI or ARB therapy had a lower rate of severe diseases and a trend toward a lower level of IL-6 in peripheral blood. In addition, ACEI or ARB therapy increased CD3 and CD8 T cell counts in peripheral blood and decreased the peak viral load compared to other antihypertensive drugs. This evidence supports the benefit of using ACEIs or ARBs to potentially contribute to the improvement of clinical outcomes of COVID-19 patients with hypertension.
The diagnostic accuracy of contrast-enhanced ultrasound (CEUS) for distinguishing malignant thyroid nodules from benign thyroid nodules remains controversial. This meta-analysis was performed to ...evaluate the overall diagnostic value of CEUS for the characterization of thyroid nodules. Relevant studies were identified by searching PubMed, Embase and the Cochrane Library until August 1th 2019 to assess the overall diagnostic accuracy of CEUS. 37 eligible studies were included in the present meta-analysis. The pooled sensitivity, specificity, positive likelihood rate, negative likelihood rate and diagnostic odds ratio of CEUS were 0.87, 0.83, 5.38, 0.17 and 38.94, respectively, with the AUC of 0.9263. Subgroup analysis showed the heterogeneity was greatly reduced in small nodules group (≤ 1 cm) (I2 = 0.0%), while heterogeneity was still observed in the group of variable sizes group (I2 = 69.5%). However, meta-regression analysis revealed that only diagnostic criterion was the major source of heterogeneity (p = 0.0259). The risk of publication bias was negligible (p = 0.35). CEUS exhibited high accuracy for the identification of thyroid nodules and might provide additional perfusion information for the current US imaging reporting systems.
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