Entrepreneurial opportunities, implicit contracts and market making for complex consumer goods

This article extends the theory of entrepreneurial opportunity exploitation, outlining how under certain conditions, opportunity exploitation is dependent on market making innovations. Where adverse selection and moral hazard characterize markets, consumers are likely to withdraw regardless of product quality. In order to overcome consumer resistance, entrepreneurs must signal credible commitments. But because consumers purchase without fully specifying requirements, entrepreneurs' commitments take the partial form of implicit contracts, creating strong mutual commitments to repeated transactions. These commitments enable novel markets to function, but introduce additional costs. This article illustrates the theory with the historic case of Singer in sewing machines

The experimetrics of public goods: inferring motivations from contributions

In public goods experiments, stochastic choice, censoring and motivational heterogeneity give scope for disagreement over the extent of unselfishness, and whether it is reciprocal or altruistic. We show that these problems can be addressed econometrically, by estimating a finite mixture model to isolate types, incorporating double censoring and a tremble term. Most subjects act selfishly, but a substantial proportion are reciprocal with altruism playing only a marginal role. Isolating reciprocators enables a test of Sugden’s model of voluntary contributions. We estimate that reciprocators display a self-serving bias relative to the model.

Interpersonal interaction and economic theory: the case of public goods

Interpersonal interaction in public goods contexts is very different in character to its depiction in economic theory, despite the fact that the standard model is based on a small number of apparently plausible assumptions. Approaches to the problem are reviewed both from within and outside economics. It is argued that quick fixes such as a taste for giving do not provide a way forward. An improved understanding of why people contribute to such goods seems to require a different picture of the relationships between individuals than obtains in standard microeconomic theory, where they are usually depicted as asocial. No single economic model at present is consistent with all the relevant field and laboratory data. It is argued that there are defensible ideas from outside the discipline which ought to be explored, relying on different conceptions of rationality and/or more radically social agents. Three such suggestions are considered, one concerning the expressive/communicative aspect of behaviour, a second the possibility of a part-whole relationship between interacting agents and the third a version of conformism.

Evaluation of cumulative externality: environmental economics, oligopoly and the private provision of public goods

This paper evaluates environmental externality when the structure of the externality is cumulative. The evaluation exercise is based on the assumption that the agents in question form conjectural variations. A number of environments are encompassed within this classification and have received due attention in the literature. Each of these heterogeneous environments, however, possesses considerable analytical homogeneity and permit subscription to a general model treatment. These environments include environmental externality, oligopoly and the analysis of the private provision of public goods. We highlight the general analytical approach by focusing on this latter context, in which debate centers around four issues: the existence of free-riding, the extent to which contributions are matched equally across individuals, the nature of conjectures consistent with equilibrium, and the allocative inefficiency of alternative regimes. This paper resolves each of these issues, with the following conclusions: A consistent-conjectures equilibrium exists in the private provision of public goods. It is the monopolistic-conjectures equilibrium. Agents act identically, contributing positive amounts of the public good in an efficient allocation of resources. There is complete matching of contributions among agents, no free-riding, and the allocation is independent of the number of members within the community. Thus the Olson conjecture—that inefficiency is exacerbated by community size—has no foundation in a consistent-conjectures, cumulative-externality, context (212 words).

The social evolution of dispersal with public goods cooperation

Selection can favour the evolution of individually costly dispersal if this alleviates competition between relatives. However, conditions that favour altruistic dispersal also mediate selection for other social behaviours, such as public goods cooperation, which in turn is likely to mediate dispersal evolution. Here, we investigate – both experimentally (using bacteria) and theoretically – how social habitat heterogeneity (i.e. the distribution of public goods cooperators and cheats) affects the evolution of dispersal. In addition to recovering the well-known theoretical result that the optimal level of dispersal increases with genetic relatedness of patch mates, we find both mathematically and experimentally that dispersal is always favoured when average patch occupancy is low, but when average patch occupancy is high, the presence of public goods cheats greatly alters selection for dispersal. Specifically, when public goods cheats are localized to the home patch, higher dispersal rates are favoured, but when cheats are present throughout available patches, lower dispersal rates are favoured. These results highlight the importance of other social traits in driving dispersal evolution.

Optimal tax mix with merit goods

This paper deals with optimal taxation in a two‐class economy with two private commodities and labour. We derive optimal non‐linear income and linear commodity taxes in the presence of merit goods. We formulate merit good arguments via a pathology of individual choice. We assume weak separability between consumption and leisure and show how the standard optimal tax results are modified due to merit good considerations.

Risk management or goods promotion : the relationship between approach and avoidance goals in treatment for sex offenders

In this paper, we propose that there is a direct relationship between risk management and goods (or goal) promotion in the treatment of sexual offenders. We argue that the causal conditions required to promote specific goods are likely, in turn, to eliminate or modify dynamic risk factors (i.e., criminogenic needs). First, the concepts of risk and goals are briefly discussed and their important dimensions clarified. Second, the relationship between criminogenic needs and goals are analyzed in depth. Third, we further clarify our arguments by focusing on four classes of criminogenic needs recently identified in the sexual offending literature: sexual self-regulation, offense supportive cognitions, level of interpersonal functioning, and general self-management problems. Finally, we conclude the paper with some suggestions for future research and treatment.

Brand salience for fast-moving consumer goods : an empirically based model

Brand salience, or the prominence of a brand in memory, has been linked to brand choice and purchase by consumers. The research reported in this paper proposed and tested a model of brand salience for fast-moving consumer goods, which incorporates knowledge, media consumption, and brand image as antecedents. A quasi-experimental method was utilised, where 270 respondents undertook a free recall exercise using category cues, and then completed multiitem measures of brand knowledge, brand associations, and purchase likelihood. Analysis of the data using SEM found support for an empirical model of brand salience where there was a relationship between brand salience and purchase likelihood. The empirical evidence supports building a brand in a primary category, in order to build the depth and breadth of the brand’s associations in consumer memory.

Promoting human goods and reducing risk

Rehabilitation should be concerned with equipping offenders with the capabilities and values to live prosocial and personally meaningful lives. is depends on the acquisition of accurate knowledge of the social and physical world, development of a robust understanding of their own values and standards, the ability to pursue their own personal good in specific environments, and being able to utilise the resources they require to overcome routine obstacles in the pursuit of that good. ese two sets of capacities are embedded in a narrative identity that reflects peoples’ commitments, personal projects or goals, and subsequent activities. Narratives are stories of past experience and sets of expectations about future experiences and lives. ey both guide the actions of individuals and shape their experiences and lives (Kekes, 1993; Ward & Stewart, 2003). A person’s sense of who he is emerges from his personal projects and activities in the world.

Some insights on religion from public goods economics

This paper provides a theoretical discussion on what analytical insight is gained by viewing religion as both a pure and impure public good. It suggests that organized religion converts a public good into an excludable club good and can be viewed as providing both an access regime for this club good as well as acting as an intermediary. Interestingly, this drives a wedge between the ardent and moderate adherents of a religion. It also presents an analysis of trust in social relationships when organized religion works to provide a credible signal of trustworthiness.