Bargaining for power and information : an experimental and theoretical analysis of the interaction between institutions, externalities and adverse selection

Bargaining is the building block of many economic interactions, ranging from bilateral to multilateral encounters and from situations in which the actors are individuals to negotiations between firms or countries. In all these settings, economists have been intrigued for a long time by the fact that some projects, trades or agreements are not realized even though they are mutually beneficial. On the one hand, this has been explained by incomplete information. A firm may not be willing to offer a wage that is acceptable to a qualified worker, because it knows that there are also unqualified workers and cannot distinguish between the two types. This phenomenon is known as adverse selection. On the other hand, it has been argued that even with complete information, the presence of externalities may impede efficient outcomes. To see this, consider the example of climate change. If a subset of countries agrees to curb emissions, non-participant regions benefit from the signatories’ efforts without incurring costs. These free riding opportunities give rise to incentives to strategically improve ones bargaining power that work against the formation of a global agreement. This thesis is concerned with extending our understanding of both factors, adverse selection and externalities. The findings are based on empirical evidence from original laboratory experiments as well as game theoretic modeling. On a very general note, it is demonstrated that the institutions through which agents interact matter to a large extent. Insights are provided about which institutions we should expect to perform better than others, at least in terms of aggregate welfare. Chapters 1 and 2 focus on the problem of adverse selection. Effective operation of markets and other institutions often depends on good information transmission properties. In terms of the example introduced above, a firm is only willing to offer high wages if it receives enough positive signals about the worker’s quality during the application and wage bargaining process. In Chapter 1, it will be shown that repeated interaction coupled with time costs facilitates information transmission. By making the wage bargaining process costly for the worker, the firm is able to obtain more accurate information about the worker’s type. The cost could be pure time cost from delaying agreement or cost of effort arising from a multi-step interviewing process. In Chapter 2, I abstract from time cost and show that communication can play a similar role. The simple fact that a worker states to be of high quality may be informative. In Chapter 3, the focus is on a different source of inefficiency. Agents strive for bargaining power and thus may be motivated by incentives that are at odds with the socially efficient outcome. I have already mentioned the example of climate change. Other examples are coalitions within committees that are formed to secure voting power to block outcomes or groups that commit to different technological standards although a single standard would be optimal (e.g. the format war between HD and BlueRay). It will be shown that such inefficiencies are directly linked to the presence of externalities and a certain degree of irreversibility in actions. I now discuss the three articles in more detail. In Chapter 1, Olivier Bochet and I study a simple bilateral bargaining institution that eliminates trade failures arising from incomplete information. In this setting, a buyer makes offers to a seller in order to acquire a good. Whenever an offer is rejected by the seller, the buyer may submit a further offer. Bargaining is costly, because both parties suffer a (small) time cost after any rejection. The difficulties arise, because the good can be of low or high quality and the quality of the good is only known to the seller. Indeed, without the possibility to make repeated offers, it is too risky for the buyer to offer prices that allow for trade of high quality goods. When allowing for repeated offers, however, at equilibrium both types of goods trade with probability one. We provide an experimental test of these predictions. Buyers gather information about sellers using specific price offers and rates of trade are high, much as the model’s qualitative predictions. We also observe a persistent over-delay before trade occurs, and this mitigates efficiency substantially. Possible channels for over-delay are identified in the form of two behavioral assumptions missing from the standard model, loss aversion (buyers) and haggling (sellers), which reconcile the data with the theoretical predictions. Chapter 2 also studies adverse selection, but interaction between buyers and sellers now takes place within a market rather than isolated pairs. Remarkably, in a market it suffices to let agents communicate in a very simple manner to mitigate trade failures. The key insight is that better informed agents (sellers) are willing to truthfully reveal their private information, because by doing so they are able to reduce search frictions and attract more buyers. Behavior observed in the experimental sessions closely follows the theoretical predictions. As a consequence, costless and non-binding communication (cheap talk) significantly raises rates of trade and welfare. Previous experiments have documented that cheap talk alleviates inefficiencies due to asymmetric information. These findings are explained by pro-social preferences and lie aversion. I use appropriate control treatments to show that such consideration play only a minor role in our market. Instead, the experiment highlights the ability to organize markets as a new channel through which communication can facilitate trade in the presence of private information. In Chapter 3, I theoretically explore coalition formation via multilateral bargaining under complete information. The environment studied is extremely rich in the sense that the model allows for all kinds of externalities. This is achieved by using so-called partition functions, which pin down a coalitional worth for each possible coalition in each possible coalition structure. It is found that although binding agreements can be written, efficiency is not guaranteed, because the negotiation process is inherently non-cooperative. The prospects of cooperation are shown to crucially depend on i) the degree to which players can renegotiate and gradually build up agreements and ii) the absence of a certain type of externalities that can loosely be described as incentives to free ride. Moreover, the willingness to concede bargaining power is identified as a novel reason for gradualism. Another key contribution of the study is that it identifies a strong connection between the Core, one of the most important concepts in cooperative game theory, and the set of environments for which efficiency is attained even without renegotiation.

Trust and Reputation in Internet Auctions

Exchange between anonymous actors in Internet auctions corresponds to a one-shot prisoner's dilemma-like situation. Therefore, in any given auction the risk is high that seller and buyer will cheat and, as a consequence, that the market will collapse. However, mutual cooperation can be attained by the simple and very efficient institution of a public rating system. By this system, sellers have incentives to invest in reputation in order to enhance future chances of business. Using data from about 200 auctions of mobile phones we empirically explore the effects of the reputation system. In general, the analysis of nonobtrusive data from auctions may help to gain a deeper understanding of basic social processes of exchange, reputation, trust, and cooperation, and of the impact of institutions on the efficiency of markets. In this study we report empirical estimates of effects of reputation on characteristics of transactions such as the probability of a successful deal, the mode of payment, and the selling price (highest bid). In particular, we try to answer the question whether sellers receive a "premium" for reputation. Our results show that buyers are willing to pay higher prices for reputation in order to diminish the risk of exploitation. On the other hand, sellers protect themselves from cheating buyers by the choice of an appropriate payment mode. Therefore, despite the risk of mutual opportunistic behavior, simple institutional settings lead to cooperation, relatively rare events of fraud, and efficient markets.

Sexual health of ethnic minority MSM in Britain (MESH project): design and methods

Background Men who have sex with men (MSM) remain the group most at risk of acquiring HIV infection in Britain. HIV prevalence appears to vary widely between MSM from different ethnic minority groups in this country for reasons that are not fully understood. The aim of the MESH project was to examine in detail the sexual health of ethnic minority MSM living in Britain. Methods/Design The main objectives of the MESH project were to explore among ethnic minority MSM living in Britain: (i) sexual risk behaviour and HIV prevalence; (ii) their experience of stigma and discrimination; (iii) disclosure of sexuality; (iv) use of, and satisfaction with sexual health services; (v) the extent to which sexual health services (for treatment and prevention) are aware of the needs of ethnic minority MSM. The research was conducted between 2006 and 2008 in four national samples: (i) ethnic minority MSM living in Britain; (ii) a comparison group of white British MSM living in Britain; (iii) NHS sexual health clinic staff in 15 British towns and cities with significant ethnic minority communities and; (iv) sexual health promotion/HIV prevention service providers. We also recruited men from two "key migrant" groups living in Britain: MSM born in Central or Eastern Europe and MSM born in Central or South America. Internet-based quantitative and qualitative research methods were used. Ethnic minority MSM were recruited through advertisements on websites, in community venues, via informal networks and in sexual health clinics. White and "key migrant" MSM were recruited mostly through Gaydar, one of the most popular dating sites used by gay men in Britain. MSM who agreed to take part completed a questionnaire online. Ethnic minority MSM who completed the online questionnaire were asked if they would be willing to take part in an online qualitative interview using email. Service providers were identified through the British Association of Sexual Health and HIV (BASHH) and the Terrence Higgins Trust (THT) CHAPS partnerships. Staff who agreed to take part were asked to complete a questionnaire online. The online survey was completed by 1241 ethnic minority MSM, 416 men born in South and Central America or Central and Eastern Europe, and 13,717 white British MSM; 67 ethnic minority MSM took part in the online qualitative interview. In addition 364 people working in sexual health clinics and 124 health promotion workers from around Britain completed an online questionnaire. Discussion The findings from this study will improve our understanding of the sexual health and needs of ethnic minority MSM in Britain.

Helper response to experimentally manipulated predation risk in the cooperatively breeding cichlid Neolamprologus pulcher

Background We manipulated predation risk in a field experiment with the cooperatively breeding cichlid Neolamprologus pulcher by releasing no predator, a medium- or a large-sized fish predator inside underwater cages enclosing two to three natural groups. We assessed whether helpers changed their helping behaviour, and whether within-group conflict changed, depending on these treatments, testing three hypotheses: ‘pay-to-stay’ PS, ‘risk avoidance’ RA, or (future) reproductive benefits RB. We also assessed whether helper food intake was reduced under risk, because this might reduce investments in other behaviours to save energy. Methodology/Principal Findings Medium and large helpers fed less under predation risk. Despite this effect helpers invested more in territory defence, but not territory maintenance, under the risk of predation (supporting PS). Experimentally covering only the breeding shelter with sand induced more helper digging under predation risk compared to the control treatment (supporting PS). Aggression towards the introduced predator did not differ between the two predator treatments and increased with group member size and group size (supporting PS and RA). Large helpers increased their help ratio (helping effort/breeder aggression received, ‘punishment’ by the dominant pair in the group) in the predation treatments compared to the control treatment, suggesting they were more willing to PS. Medium helpers did not show such effects. Large helpers also showed a higher submission ratio (submission/ breeder aggression received) in all treatments, compared to the medium helpers (supporting PS). Conclusions/Significance We conclude that predation risk reduces helper food intake, but despite this effect, helpers were more willing to support the breeders, supporting PS. Effects of breeder punishment suggests that PS might be more important for large compared to the medium helpers. Evidence for RA was also detected. Finally, the results were inconsistent with RB.

Gender differences of atrial and ventricular remodeling and autonomic tone in nonelite athletes

Veteran endurance athletes have an increased risk of developing atrial fibrillation (AF), with a striking male predominance. We hypothesized that male athletes were more prone to atrial and ventricular remodeling and investigated the signal-averaged P wave and factors that promote the occurrence of AF. Nonelite athletes scheduled to participate in the 2010 Grand Prix of Bern, a 10-mile race, were invited. Of the 873 marathon and nonmarathon runners who were willing to participate, 68 female and 70 male athletes were randomly selected. The runners with cardiovascular disease or elevated blood pressure (>140/90 mm Hg) were excluded. Thus, 121 athletes were entered into the final analysis. Their mean age was 42 ± 7 years. No gender differences were found for age, lifetime training hours, or race time. The male athletes had a significantly longer signal-averaged P-wave duration (136 ± 12 vs 122 ± 10 ms; p <0.001). The left atrial volume was larger in the male athletes (56 ± 13 vs 49 ± 10 ml; p = 0.001), while left atrial volume index showed no differences (29 ± 7 vs 30 ± 6 ml/m²; p = 0.332). In male athletes, the left ventricular mass index (107 ± 17 vs 86 ± 16 g/m²; p <0.001) and relative wall thickness (0.44 ± 0.06 vs 0.41 ± 0.07; p = 0.004) were greater. No differences were found in the left ventricular ejection fraction (63 ± 4% vs 66 ± 6%; p = 0.112) and mitral annular tissue Doppler e' velocity (10.9 ± 1.5 vs 10.6 ± 1.5 cm/s; p = 0.187). However, the tissue Doppler a' velocity was higher (8.7 ± 1.2 vs 7.6 ± 1.3 cm/s; p < 0.001) in the male athletes. Male athletes had a higher systolic blood pressure at rest (123 ± 9 vs 110 ± 11 mm Hg; p < 0.001) and at peak exercise (180 ± 15 vs 169 ± 19 mm Hg; p = 0.001). In the frequency domain analysis of heart rate variability, the sympatho-vagal balance, represented by the low/high-frequency power ratio, was significantly greater in male athletes (5.8 ± 2.8 vs 3.9 ± 1.9; p < 0.001). Four athletes (3.3%) had at least one documented episode of paroxysmal AF, all were men (p = 0.042). In conclusion, for a comparable amount of training and performance, male athletes showed a more pronounced atrial remodeling, a concentric type of ventricular remodeling, and an altered diastolic function. A higher blood pressure at rest and during exercise and a higher sympathetic tone might be causal. The altered left atrial substrate might facilitate the occurrence of AF.

Health-related quality of life anticipated with different management strategies for febrile neutropenia in adult cancer patients

PURPOSE: To describe anticipated health-related quality of life (HRQL) for different hypothetical strategies of febrile neutropenia (FN) management in adult cancer patients. METHODS: Seventy-eight adult cancer patients were enrolled. Our study considered four different hypothetical treatment strategies for FN: (1) entire inpatient management with intravenous (IV) antibiotics; (2) oral treatment at home after an initial observation in hospital with IV antibiotics; (3) entire outpatient management with IV antibiotics; and (4) entire outpatient management with oral antibiotics. Initially, patients were asked to rank the different treatment strategies for FN based on their personal preference. Subsequently, HRQL was rated using visual analog scale (VAS), time trade-off (TTO), and willingness-to-pay (WTP). RESULTS: Seventy-five percent of all respondents preferred an outpatient strategy for FN (36% oral, 21% intravenous, 18% early discharge). Further, outpatient strategies were associated with higher mean VAS scores (possible range 0-10) (oral: 6.1 (standard deviation (SD) 3.1); intravenous: 6.2 (SD 2.2); early discharge: 5.7 (SD 2.1)) as compared to inpatient care (5.3 (SD 2.9)). On the aggregate level, patients were willing to give up between 9 and 10 weeks of their life (TTO; corresponding to <1% of remaining life expectancy) and to pay between $255 and $327 Canadian dollars (WTP) to avoid treatment in hospital. CONCLUSIONS: Our study indicates that the majority of adult cancer patients would prefer an outpatient strategy for FN. However, patients' preferences vary substantially at the individual level. Implementation of outpatient strategies into routine clinical practice should consider this variability.

Expanded polytetrafluoroethylene graft for bypass surgery using the excimer laser-assisted nonocclusive anastomosis technique

OBJECT: Patients with complex craniocerebral pathophysiologies such as giant cerebral aneurysms, skull base tumors, and/or carotid artery occlusive disease are candidates for a revascularization procedure to augment or preserve cerebral blood flow. However, the brain is susceptible to ischemia, and therefore the excimer laser-assisted nonocclusive anastomosis (ELANA) technique has been developed to overcome temporary occlusion. Harvesting autologous vessels of reasonable quality, which is necessary for this technique, may at times be problematic or impossible due to the underlying systemic vascular disease. The use of artificial vessels is therefore an alternative graft for revascularization. Note, however, that it is unknown to what degree these grafts are subject to occlusion using the ELANA anastomosis technique. Therefore, the authors studied the ELANA technique in combination with an expanded polytetrafluoroethylene (ePTFE) graft. METHODS: The experimental surgeries involved bypassing the abdominal aorta in the rabbit. Ten rabbits were subjected to operations representing 20 ePTFE graft-ELANA end-to-side anastomoses. Intraoperative blood flow, followup angiograms, and long-term histological characteristics were assessed 75, 125, and 180 days postoperatively. Angiography results proved long-term patency of ePTFE grafts in all animals at all time points studied. Data from the histological analysis showed minimal intimal reaction at the anastomosis site up to 180 days postoperatively. Endothelialization of the ePTFE graft was progressive over time. CONCLUSIONS: The ELANA technique in combination with the ePTFE graft seems to have favorable attributes for end-to-side anastomoses and may be suitable for bypass procedures.

Quantitative stress echocardiography in coronary artery disease using contrast-based myocardial blood flow measurements: prospective comparison with coronary angiography

AIM: To test whether quantitative stress echocardiography using contrast-based myocardial blood flow (MBF, ml x min(-1) x g(-1)) measurements can detect coronary artery disease in humans. METHODS: 48 patients eligible for pharmacological stress testing by myocardial contrast echocardiography (MCE) and willing to undergo subsequent coronary angiography were prospectively enrolled in the study. Baseline and adenosine-induced (140 microg x kg(-1) x min(-1)) hyperaemic MBF was analysed according to a three-coronary-artery-territory model. Vascular territories were categorised into three groups with increasing stenosis severity defined as percentage diameter reduction by quantitative coronary angiography. RESULTS: Myocardial blood flow reserve (MBFR)-that is, the ratio of hyperaemic to baseline MBF, was obtained in 128 (89%) territories. Mean (SD) baseline MBF was 1.073 (0.395) ml x min(-1) x g(-1) and did not differ between territories supplied by coronary arteries with mild (<50% stenosis), moderate (50%-74% stenosis) or severe (>or=75% stenosis) disease. Mean (SD) hyperaemic MBF and MBFR were 2.509 (1.078) ml x min(-1) x g(-1) and 2.54 (1.03), respectively, and decreased linearly (r2 = 0.21 and r2 = 0.39) with stenosis severity. ROC analysis revealed that a territorial MBFR <1.94 detected >or=50% stenosis with 89% sensitivity and 92% specificity. CONCLUSION: Quantitative stress testing based on MBF measurements derived from contrast echocardiography is a new method for the non-invasive and reliable assessment of coronary artery disease in humans.

Opinions on registering trial details: a survey of academic researchers

BACKGROUND: The World Health Organization (WHO) has established a set of items related to study design and administrative information that should build the minimum set of data in a study register. A more comprehensive data set for registration is currently developed by the Ottawa Group. Since nothing is known about the attitudes of academic researchers towards prospective study registration, we surveyed academic researchers about their opinion regarding the registration of study details proposed by the WHO and the Ottawa Group. METHODS: This was a web-based survey of academic researchers currently running an investigator-initiated clinical study which is registered with clinicaltrials.gov. In July 2006 we contacted 1299 principal investigators of clinical studies by e-mail explaining the purpose of the survey and a link to access a 52-item questionnaire based on the proposed minimum data set by the Ottawa Group. Two reminder e-mails were sent each two weeks apart. Association between willingness to disclose study details and study phase was assessed using the chi-squared test for trend. To explore the potential influence of non-response bias we used logistic regression to assess associations between factors associated with non-response and the willingness to register study details. RESULTS: Overall response was low as only 282/1299 (22%) principal investigators participated in the survey. Disclosing study documents, in particular the study protocol and financial agreements, was found to be most problematic with only 31% of respondents willing to disclose these publicly. Consequently, only 34/282 (12%) agreed to disclose all details proposed by the Ottawa Group. Logistic regression indicated no association between characteristics of non-responders and willingness to disclose details. CONCLUSION: Principal investigators of non-industry sponsored studies are reluctant to disclose all data items proposed by the Ottawa Group. Disclosing the study protocol and financial agreements was found to be most problematic. Future discussions on trial registration should not only focus on industry but also on academic researchers.

Combined cardiac and lung volume reduction surgery

Coronary artery disease is prevalent in patients who have severe emphysema and who are being considered for lung volume reduction surgery (LVRS). Significant valvular heart diseases may also coexist in these patients. Few thoracic surgeons have performed LVRS in patients who have severe cardiac diseases. Conversely, few cardiac surgeons have been willing to undertake major cardiac surgery in patients who have severe emphysema. This report reviews the evidence regarding combined cardiac surgery and LVRS to determine the optimal management strategy for patients who have severe emphysema and who are suitable for LVRS, but who also have coexisting significant cardiac diseases that are operable.

Self-licensing effects on food choices

Recalling an egoistic act nudges people to choose healthy over unhealthy food options. Conversely, participants preferred unhealthy over healthy food options when they recalled an altruistic deed. Consistent with this choice pattern participants were willing to pay more for healthy than for unhealthy options. This experiment extends the self-licensing literature.

Equine parasite control under prescription-only conditions in Denmark - Awareness, knowledge, perception, and strategies applied.

Due to widespread development of anthelmintic resistance in equine parasites, recommendations for their control are currently undergoing marked changes with a shift of emphasis toward more coprological surveillance and reduced treatment intensity. Denmark was the first nation to introduce prescription-only restrictions of anthelmintic drugs in 1999, but other European countries have implemented similar legislations over recent years. A questionnaire survey was performed in 2008 among Danish horse owners to provide a current status of practices and perceptions with relation to parasite control. Questions aimed at describing the current use of coprological surveillance and resulting anthelmintic treatment intensities, evaluating knowledge and perceptions about the importance of various attributes of parasite control, and assessing respondents' willingness to pay for advice and parasite surveillance services from their veterinarians. A total of 1060 respondents completed the questionnaire. A large majority of respondents (71.9%) were familiar with the concept of selective therapy. Results illustrated that the respondents' self-evaluation of their knowledge about parasites and their control associated significantly with their level of interest in the topic and their type of education (P<0.0001). The large majority of respondents either dewormed their horses twice a year and/or performed two fecal egg counts per horse per year. This approach was almost equally pronounced in foals, horses aged 1-3 years old, and adult horses. The respondents rated prevention of parasitic disease and prevention of drug resistance as the most important attributes, while cost and frequent fecal testing were rated least important. Respondents' actual spending on parasite control per horse in the previous year correlated significantly with the amount they declared themselves willing to spend (P<0.0001). However, 44.4% declared themselves willing to pay more than what they were spending. Altogether, results indicate that respondents were generally familiar with equine parasites and the concept of selective therapy, although there was some confusion over the terms small and large strongyles. They used a large degree of fecal surveillance in all age groups, with a majority of respondents sampling and/or treating around twice a year. Finally, respondents appeared willing to spend money on parasite control for their horses. It is of concern that the survey suggested that foals and young horses are treated in a manner very similar to adult horses, which is against current recommendations. Thus, the survey illustrates the importance of clear communication of guidelines for equine parasite control.

Smoking behaviour, former quit attempts and intention to quit in urban adolescents and young adults: A five-year longitudinal study

OBJECTIVES: To examine smoking behaviour, former quit attempts and intention to quit among Swiss adolescents and young adults over five year's time. STUDY DESIGN: five-year longitudinal study (2003, 2005 and 2008) based on a random urban community sample (N = 1345 complete cases). METHODS: Data were collected by computer-assisted telephone interviews with adolescents (16-17) and young adults (18-24). Main outcome measures included self-reported smoking behaviour, former quit attempts, smoking cessation methods and current intentions to quit smoking. RESULTS: Adolescents were more often non-smokers and less often daily smokers when compared to young adults at baseline (χ(2)(4) = 28.68, P < .001). Their smoking behaviour increased significantly from baseline to follow-up (T = 1445.50, r = .20, P < .001) in contrast to the stable smoking behaviour in young adults (χ(2)(2) = .12, n.s.). In longitudinal analyses young adults were also more stable in their smoking status at the later measurement points. In comparison adolescents changed their smoking status more often being non-smokers at baseline and smokers later on. Independently of the age group, the majority of smokers already had previously attempted to quit (65%) or intended to give up smoking at some point (72%). However only 17% were motivated to make the quit attempt within the next 6 months. Self-quitting was the preferred method, and 25% of the self-quitters had been successful. CONCLUSION: This study illustrates that different developments in smoking behaviour exist in adolescents and young adults. Our study reveals that a majority of smokers are willing to quit but often fail. Furthermore, the data indicates that for adolescents the focus should lie on primary prevention.

Gender-fair language in the context of leadership: Preventing the lack of fit for women

Women are still underrepresented in leadership due to a perceived a ‘lack of fit’. Thus, women are hired less likely, evaluated unfavorably or are less willing to take over a leadership role than their male counterparts. Because gender-fair language (e.g., feminine-masculine word pairs, German: ‘Geschäftsführerin/Geschäftsführer’, CEO, fem./CEO, masc.) leads to a higher mental inclusion of women compared to generic masculine forms (German: ‘Geschäftsführer’, CEO,masc.), we argue that masculine forms endorse the ‘lack of fit’ for women in leadership, whereas gender-fair language reduces it. Three studies support our assumption. Masculine forms led to a ‘lack of fit’ for women in leader selection: they were hired less likely (Study 1) and evaluated less favorably (Study 2) than their male counterparts. Moreover, women showed less willingness to apply when masculine forms were used in the advertisement for a leadership position. Contrary, no such gender-bias was obtained in case of gender-fair language.

Online privacy concerns and legal assurance: a user perspective

Since the emergence of the Internet and Social Media, privacy concerns and need for regulation in this area have been a frequent subject on the agenda of numerous stakeholders and policy-makers worldwide. Contributing to this debate, this paper builds on the responses of 553 Internet users to uncover users’ current privacy concerns and their attitudes towards legal assurances in this context. Our findings suggest that users have a complex attitude towards these issues. While they express strong concerns about privacy when asked directly, they often have difficulties formulating the exact nature of these concerns. In the Facebook context, Facebook itself is often mentioned as the primary source of threat, closely followed by marketing organizations. Users feel ill-protected by existing legal framework, especially when using Social Networking Sites. Reasons include common beliefs that the law is unable to address complexities of the Internet; local character of laws; possibilities to disregard the law, particularly since enforcement is difficult. Overall, positive changes in legal framework are desirable, with many respondents willing to pay more in taxes to ensure progress in this area.