Experts vs. Discounters: Consumer Free Riding and Experts Withholding Advice in Markets for Credence Goods

This paper studies the incentives for credence goods experts to invest effort in diagnosis if effort is both costly and unobservable, and if they face competition by discounters who are not able to perform a diagnosis. The unobservability of diagnosis effort and the credence characteristic of the good induce experts to choose incentive compatible tariff structures. This makes them vulnerable to competition by discounters. We explore the conditions under which honestly diagnosing experts survive competition by discounters; we identify situations in which experts misdiagnose consumers in order to prevent them from free-riding on experts' advice; and we discuss policy options to solve the free-riding consumers–cheating experts problem.

The economics of credence goods: An experimental investigation of the role of verifiability, liability, competition and reputation in credence goods markets

Credence goods markets are characterized by asymmetric information between sellers and consumers that may give rise to inefficiencies, such as under- and overtreatment or market break-down. We study in a large experiment with 936 participants the determinants for efficiency in credence goods markets. While theory predicts that either liability or verifiability yields efficiency, we find that liability has a crucial, but verifiability only a minor effect. Allowing sellers to build up reputation has little influence, as predicted. Seller competition drives down prices and yields maximal trade, but does not lead to higher efficiency as long as liability is violated.

The impact of distributional preferences on (experimental) markets for expert services

Theory predicts that efficiency prevails on credence goods markets if customers are able to verify which quality they receive from an expert seller. In a series of experiments with endogenous prices we observe that verifiability fails to result in efficient provision behaviour and leads to very similar results as a setting without verifiability. Some sellers always provide appropriate treatment even if own money maximization calls for over- or undertreatment. Overall our endogenous-price-results suggests that both inequality aversion and a taste for efficiency play an important role for experts’ provision behaviour. We contrast the implications of those two motivations theoretically and discriminate between them empirically using a fixed-price design. We then classify experimental experts according to their provision behaviour.

Process mining manifesto

Process mining techniques are able to extract knowledge from event logs commonly available in today’s information systems. These techniques provide new means to discover, monitor, and improve processes in a variety of application domains. There are two main drivers for the growing interest in process mining. On the one hand, more and more events are being recorded, thus, providing detailed information about the history of processes. On the other hand, there is a need to improve and support business processes in competitive and rapidly changing environments. This manifesto is created by the IEEE Task Force on Process Mining and aims to promote the topic of process mining. Moreover, by defining a set of guiding principles and listing important challenges, this manifesto hopes to serve as a guide for software developers, scientists, consultants, business managers, and end-users. The goal is to increase the maturity of process mining as a new tool to improve the (re)design, control, and support of operational business processes.

Verifiability in Markets for Credence Goods

Theory predicts that efficiency prevails on credence goods markets if customers are able to verify which quality they receive from an expert seller. In a series of experiments with endogenous prices we observe that variability fails to result in efficient provision behavior and leads to very similar results as a setting without variability. Some sellers always provide appropriate treatment even if own money maximization calls for over- or undertreatment. Overall our endogenous price-results suggests that both inequality aversion and a taste for efficiency play an important role for experts provision behavior. We contrast the implications of those two motivations theoretically and discriminate between them empirically using a �xed-price design. We then classify experimental experts according to their provision behavior.

How distributional preferences shape incentives on (experimental) markets for credence goods

Credence goods markets suffer from inefficiencies caused by superior information of sellers about the surplus-maximizing quality. While standard theory predicts that equal mark-up prices solve the credence goods problem if customers can verify the quality received, experimental evidence indicates the opposite. We identify a lack of robustness of institutional design with respect to heterogeneity in distributional preferences as a possible cause and design new experiments that allow for parsimonious identification of sellers’ distributional types. Our results indicate that less than a fourth of the subjects behave according to standard theory’s assumption, the rest behaving either in line with non-standard selfish or in accordance with non-trivial other-regarding preferences. We discuss consequences of our findings for institutional design and agent selection.

An instrument to measure adherence to weight loss programs : the Compliance Praxis Survey-Diet (COMPASS-Diet)

Adherence to behavioral weight loss strategies is important for weight loss success. We aimed to examine the reliability and validity of a newly developed compliance praxis-diet (COMPASS-diet) survey with participants in a 10-week dietary intervention program. During the third of five sessions, participants of the “slim-without-diet” weight loss program (n = 253) completed the COMPASS-diet survey and provided data on demographic and clinical characteristics, and general self-efficacy. Group facilitators completed the COMPASS-diet-other scale estimating participants’ likely adherence from their perspective. We calculated internal consistency, convergent validity, and predictive value for objectively measured weight loss. Mean COMPASS-diet-self score was 82.4 (SD 14.2) and COMPASS-diet-other score 80.9 (SD 13.6) (possible range 12–108), with lowest scores in the normative behavior subscale. Cronbach alpha scores of the COMPASS-diet-self and -other scale were good (0.82 and 0.78, respectively). COMPASS-diet-self scores (r = 0.31) correlated more highly with general self-efficacy compared to COMPASS-diet-other scores (r = 0.04) providing evidence for validity. In multivariable analysis adjusted for age and gender, both the COMPASS-diet-self (F = 10.8, p < 0.001, r2 = 0.23) and other (F = 5.5, p < 0.001, r2 = 0.19) scales were significantly associated with weight loss achieved at program conclusion. COMPASS-diet surveys will allow group facilitators or trainers to identify patients who need additional support for optimal weight loss.

The economics of credence goods : an experiment on the role of liability, verifiability, reputation and competition

Credence goods markets are characterized by asymmetric information between sellers and consumers that may give rise to inefficiencies, such as under- and overtreatment or market breakdown. We study in a large experiment with 936 participants the determinants for efficiency in credence goods markets. While theory predicts that liability or verifiability yield efficiency, we find that liability has a crucial, but verifiability at best a minor, effect. Allowing sellers to build up reputation has little influence, as predicted. Seller competition drives down prices and yields maximal trade, but does not lead to higher efficiency as long as liability is violated. (JEL D12, D82)

A novel 15N tracer approach for the quantification of N2 and N2O emissions from soil incubations in a completely automated laboratory set up

The microbial mediated production of nitrous oxide (N2O) and its reduction to dinitrogen (N2) via denitrification represents a loss of nitrogen (N) from fertilised agro-ecosystems to the atmosphere. Although denitrification has received great interest by biogeochemists in the last decades, the magnitude of N2lossesand related N2:N2O ratios from soils still are largely unknown due to methodical constraints. We present a novel 15N tracer approach, based on a previous developed tracer method to study denitrification in pure bacterial cultures which was modified for the use on soil incubations in a completely automated laboratory set up. The method uses a background air in the incubation vessels that is replaced with a helium-oxygen gas mixture with a 50-fold reduced N2 background (2 % v/v). This method allows for a direct and sensitive quantification of the N2 and N2O emissions from the soil with isotope-ratio mass spectrometry after 15N labelling of denitrification N substrates and minimises the sensitivity to the intrusion of atmospheric N2 at the same time. The incubation set up was used to determine the influence of different soil moisture levels on N2 and N2O emissions from a sub-tropical pasture soil in Queensland/Australia. The soil was labelled with an equivalent of 50 μg-N per gram dry soil by broadcast application of KNO3solution (4 at.% 15N) and incubated for 3 days at 80% and 100% water filled pore space (WFPS), respectively. The headspace of the incubation vessel was sampled automatically over 12hrs each day and 3 samples (0, 6, and 12 hrs after incubation start) of headspace gas analysed for N2 and N2O with an isotope-ratio mass spectrometer (DELTA V Plus, Thermo Fisher Scientific, Bremen, Germany(. In addition, the soil was analysed for 15N NO3- and NH4+ using the 15N diffusion method, which enabled us to obtain a complete N balance. The method proved to be highly sensitive for N2 and N2O emissions detecting N2O emissions ranging from 20 to 627 μN kg-1soil-1hr-1and N2 emissions ranging from 4.2 to 43 μN kg-1soil-1hr-1for the different treatments. The main end-product of denitrification was N2O for both water contents with N2 accounting for 9% and 13% of the total denitrification losses at 80% and 100%WFPS, respectively. Between 95-100% of the added 15N fertiliser could be recovered. Gross nitrification over the 3 days amounted to 8.6 μN g-1 soil-1 and 4.7 μN g-1 soil-1, denitrification to 4.1 μN g-1 soil-1 and 11.8 μN g-1 soil-1at 80% and 100%WFPS, respectively. The results confirm that the tested method allows for a direct and highly sensitive detection of N2 and N2O fluxes from soils and hence offers a sensitive tool to study denitrification and N turnover in terrestrial agro-ecosystems.

New genetic loci link adipose and insulin biology to body fat distribution

Body fat distribution is a heritable trait and a well-established predictor of adverse metabolic outcomes, independent of overall adiposity. To increase our understanding of the genetic basis of body fat distribution and its molecular links to cardiometabolic traits, here we conduct genome-wide association meta-analyses of traits related to waist and hip circumferences in up to 224,459 individuals. We identify 49 loci (33 new) associated with waist-to-hip ratio adjusted for body mass index (BMI), and an additional 19 loci newly associated with related waist and hip circumference measures (P < 5 × 10−8). In total, 20 of the 49 waist-to-hip ratio adjusted for BMI loci show significant sexual dimorphism, 19 of which display a stronger effect in women. The identified loci were enriched for genes expressed in adipose tissue and for putative regulatory elements in adipocytes. Pathway analyses implicated adipogenesis, angiogenesis, transcriptional regulation and insulin resistance as processes affecting fat distribution, providing insight into potential pathophysiological mechanisms.