Changing social norms and CEO pay: the role of norms entrepreneurs

This is the third in a series of papers examining different aspects of the CEO compensation debate. This Article will explore attempts by norms entrepreneurs to create or modify social norms. It argues that the relevant social norms are in a state of flux because of the work of norms entrepreneurs, whose efforts might reduce the need for legislative intervention. Several new norms like majority voting for board election, say on pay, smaller multiples for severance packages, and respect for shareholder activists may be emerging due to the work of norms entrepreneurs. Part II analyzes the rich literature on social norms to determine if there are models capable of application to better correlate executive compensation with performance. Despite several problems at the definitional level, it argues that the actions of constituencies relevant to the CEO pay debate might be explained by signaling, esteem, and expressive theories. Further, social norms theories neglecting internalization are deficient; corporate actors undertake self-improvement only when they internalize norms. Part III identifies the work of norms entrepreneurs in creating or changing norms pertaining to CEO compensation, and analyzes the reasons for their success. The examples considered demonstrate the effects of dynamic normative transformations on corporate actors and illustrate the contrast in behavioral changes accompanying resistance and acceptance of new norms. Part IV concludes that norm creation in corporate law is facilitated by the role of groups where membership benefits are dependent on reputation; that directors cannot tradeoff reputation like CEOs, making the deployment of reputational sanctions against them powerful; that behavioral change is more effective when there is norm internalization; and that norms entrepreneurs ought to focus on socializing relevant actors if they aspire to be successful in achieving normative change.

A discrete choice experiment to examine the preferences of patients with cancer and their willingness to pay for different types of health care appointments

BACKGROUND: This study sought to understand the preferences of patients with cancer and the trade-offs between appointment attributes using discrete choice experiment (DCE). METHODS AND STUDY DESIGN: Patients with cancer at 3 hospitals completed a self-administered DCE. Each scenario described 6 attributes: expertise of health care professionals (HCPs), familiarity of doctors with patients' medical history, waiting time, accompaniment by family/friends, travel time, and out-of-pocket costs. Patient preferences were estimated using logistic regression. Willingness to pay (WTP) estimates were derived from regression coefficients. RESULTS: Of 512 patients contacted, 185 returned the questionnaire. The mean age was 61 years, and 60% of respondents were female. The mean time since cancer diagnosis was 34 months, 90% had received treatment; and 61% had early-stage disease. The most important attributes were expertise and familiarity of doctors with patients' medical history; distance traveled was least likely to influence patient preferences. The WTP analysis estimated that patients were willing to pay $680 (95% CI, 470-891) for an appointment with a specialist, $571 (95% CI, 388-754) for doctors familiar with their history, $422 (95% CI, 262-582) for shorter waiting times, $399 (95% CI, 249-549) to be accompanied by family/friends, and $301 (95% CI, 162-441) for shorter traveling times. Male patients had a stronger preference for accompaniment by family/friends. The expertise of HCP was the most important attribute for patients regardless of geographic remoteness. CONCLUSIONS: Our study can assist the development of patient-centered health care models that improve patient access to experienced HCPs, support the role of primary care providers during the cancer journey, and educate patients about the roles of non-oncology HCPs to cope with increasing demand for cancer care.

Assessing Dodd Frank Effects on banking capital structure and Banker´s Pay structure

The systemic financial crisis that started in 2008 in the United States had some severe effects in the economic activity and required the bailout of financial institutions with the use of taxpayer’s money. It also originated claims for stronger regulatory framework in order to avoid another threat in the financial market. The Dodd Frank Act was proposed and approved in the United States in the aftermath of the crisis and brought, among many other features, the creation of the Financial Stability Oversight Council and the tougher inspection of financial institutions with asset above 50 billion dollars. The objective of this work is to study the causal effect of the Dodd Frank Act on the behavior of the treatment group subject to monitoring by the Financial Stability Oversight Council (financial institutions with assets above 50 billion dollars) regarding capital and compensation structure in comparison to the group that was not treated. We use data from Compustat and our empirical strategy is the Regression Discontinuity Design, not usually applied to the banking literature, but very useful for the present work since it allows us to compare the treatment group and the non-treatment group in the year of the enactment of the law (2010). No change of behavior was observed for the Capital Structure. In the Compensation Schemes, however, a decrease was found in the item other compensation for CEOs and CFOs. We also performed a robustness check by running a placebo test on the variables in the year before the law was enacted. No significance was found, which supports the conclusion that our main results were caused by the enactment of the DFA.

The impact on the stationary state income of a pay-as-you-go system of social security

A model of overlapping generations in continuous time is composed. IndividuaIs pass through two distinct time periods during their life times. During the first period, they work, save and have a death probability equal to zero. During the second, from the periods T after birth, their probability of death changes to p and then they retire. Capital stock and the stationary state in come are calculated for two situations: in the first, people live from their accumulated capital after retirementj in the second, they live from a state transfer payment through income taxo To simplify matters, in this preliminary version, it is supposed that there is no population growth and that the instantaneous elasticity substitution of consumption is unitary.

All-pay auctions with endogenous asymmetries

We study N-bidders, asymmetric all-pay auctions under incomplete information. First, we solve for the equilibrium of a parametric model. Each bidder’s valuation is independently drawn from an uniform [0, αi] where the parameter αi may vary across bidders. In this game, asymmetries are exogenously given. Next, a two-stage game where asymmetries are endogenously generated is studied. At the first stage, each bidder chooses the level of an observable, costly, value-enhancing action. The second stage is the bidding sub-game, whose equilibrium is simply the equilibrium of the, previously analyzed, game with exogenous asymmetries. Finally, natural applications of the all pay-auction in the context of political lobbying are considered: the effects of excluding bidders, as well as, the impact of caps on bids.

The polluter must pay

Includes bibliography

Are prescribing doctors sensitive to the price that their patients have to pay in the Spanish National Health System?

[EN] Background This study aims to design an empirical test on the sensitivity of the prescribing doctors to the price afforded for the patient, and to apply it to the population data of primary care dispensations for cardiovascular disease and mental illness in the Spanish National Health System (NHS). Implications for drug policies are discussed. Methods We used population data of 17 therapeutic groups of cardiovascular and mental illness drugs aggregated by health areas to obtain 1424 observations ((8 cardiovascular groups * 70 areas) + (9 psychotropics groups * 96 areas)). All drugs are free for pensioners. For non-pensioner patients 10 of the 17 therapeutic groups have a reduced copayment (RC) status of only 10% of the price with a ceiling of €2.64 per pack, while the remaining 7 groups have a full copayment (FC) rate of 40%. Differences in the average price among dispensations for pensioners and non-pensioners were modelled with multilevel regression models to test the following hypothesis: 1) in FC drugs there is a significant positive difference between the average prices of drugs prescribed to pensioners and non-pensioners; 2) in RC drugs there is no significant price differential between pensioner and non-pensioner patients; 3) the price differential of FC drugs prescribed to pensioners and non-pensioners is greater the higher the price of the drugs. Results The average monthly price of dispensations to pensioners and non-pensioners does not differ for RC drugs, but for FC drugs pensioners get more expensive dispensations than non-pensioners (estimated difference of €9.74 by DDD and month). There is a positive and significant effect of the drug price on the differential price between pensioners and non-pensioners. For FC drugs, each additional euro of the drug price increases the differential by nearly half a euro (0.492). We did not find any significant differences in the intensity of the price effect among FC therapeutic groups. Conclusions Doctors working in the Spanish NHS seem to be sensitive to the price that can be afforded by patients when they fill in prescriptions, although alternative hypothesis could also explain the results found.

Le Pay TV in Italia: sviluppo tecnologico e strategie aziendali

Con questa tesi si è voluto evidenziare lo stretto rapporto di dipendenza delle aziende televisive con gli eventi sportivi al fine di poter guadagnare fette di mercato e quindi posizione strategiche rispetto ai concorrenti. Tra le aziende televisive e il settore sportivo c'è quindi un rapporto mezzo/contenuto decisamente complementare. Nessuno dei due può fare a meno dell'altro. Da una parte, come evidenziato, le emittenti televisive, durante la messa in onda di eventi sportivi, registrano elevati livelli di audience e ciò costituisce la "cassa di risonanza" preferita dagli sponsor. Dall'altra parte lo sport, che anno dopo anno ha visto aumentare la propria dipendenza dai network dal momento che la cessione dei diritti televisivi è diventata una delle maggiori fonti di reddito per le società sportive.

Consumer Perception and Willingness to Pay for Local Food

A growing number of empirical studies recently investigated consumers' valuation for local food products. However, different aspects related to the local food consumption still remain vague or unexplored. As such, the objective of the present research is to fulfill the existing literature using a mixed methodological approach for the investigation of consumers' preferences and Willingness to Pay (WTP) for local food products. First of all, local food is still a blurred concept and this factor might be source of individuals' misperception for the local origin meaning. Therefore, a qualitative research has been performed in order to investigate the meaning and the perception of the local food in the Italian food market. Results from this analysis have been used as inputs for the building of a non-hypothetical Real Choice Experiment (RCE) to estimate consumers' WTP for locally and organically produced apple sauce. The contribution of this study is three-fold: (1) consumers' valuation for the local origin is interpreted in terms of regional borders, over the organic food claim in case of an unusual food product in the area of interest, (2) the interaction between individuals' personality traits and consumers’ preferences for local and organic foods is analyzed, (3) the role of Commitment Cost creation in consumers' choice making in case of uncertainty due to the use of a novel food product and of an unconventional food claim is investigated. Results suggest that consumers are willing to pay a higher price premium for organic over locally produced apple sauce, possibly because of the presence of a regulated certification. In accordance with Commitment Cost theory, the organic label might thus decrease consumers' uncertainty for the features of the product in question. Results also indicate that individuals' personality can be source of heterogeneity in consumers' preferences.