Publications

Anufriev, M, Borissov, K & Pakhnin, M 2023, 'Dissonance minimization and conversation in social networks', Journal of Economic Behavior & Organization, vol. 215, pp. 167-191.
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Baddeley, M 2023, 'Capital investment, business behaviour, and the macroeconomy', The Economic and Labour Relations Review, vol. 34, no. 1, pp. 35-50.
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AbstractGC Harcourt made many fundamental and essential contributions to the development of capital investment theory – most famously via his development of the Cambridge Capital Controversies, exposing conceptual and analytical flaws and contradictions in neoclassical approaches to defining and measuring capital. Relatedly, Harcourt also made essential contributions to our understanding of how accounting rules, used by real-world businesses to guide their investment decision-making, create anomalies and deficiencies in the accumulation of capital at a microeconomic level – with significant, deleterious consequences for the accumulation of capital at a macroeconomic level. In developing Harcourt’s contributions, this paper links Harcourt’s early insights about accounting rules with subsequent developments in behavioural economic models of business decision-making, thus aligning Harcourt’s contributions with insights from behavioural models of investment decision-making. These insights are then combined in showing how the misapplication of investment appraisal criteria at a microeconomic level contributes to under-investment and investment volatility in the macroeconomy, with negative implications for output, employment, labour productivity, wages and cyclical volatility.

Balzer, B & Schneider, J 2023, 'Mechanism design with informational punishment', Games and Economic Behavior, vol. 140, pp. 197-209.
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Christodoulou, D, Samuell, D, Slonim, R & Tausch, F 2023, 'Counteracting dishonesty strategies: A field experiment in life insurance underwriting', Journal of Behavioral Decision Making, vol. 36, no. 2.
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AbstractIndividuals often face financial incentives that challenge their desire to behave honestly. Strategically making excuses to justify dishonesty allows them to give in to the temptation of financial benefit and retain their moral self‐image. In the context of insurance underwriting, the stakes are high, as providing false information or redacting information allows customers to reduce premiums. This is particularly true for smoking disclosures that carry great weight in life insurance. We conduct a field study with a large insurance company with the aim of neutralizing justification strategies that individuals deploy for reducing the costs of dishonest smoking disclosures to insurers. First, we raise awareness of the negative consequences dishonesty could have on other policy holders to counteract that individuals could attenuate or ignore such adverse consequences. Second, we make salient the pro‐social efforts of the insurer to work against a potentially negative perception of the insurance industry that may feed the excuse of insurance companies being deserving of harm. The study presents field evidence that messages containing information about the social consequences of one's actions or the pro‐social behavior of a second party can influence normative behavior, particularly honesty.

Cobb-Clark, DA, Kettlewell, N, Schurer, S & Silburn, S 2023, 'The Effect of Quarantining Welfare on School Attendance in Indigenous Communities', Journal of Human Resources, vol. 58, no. 6, pp. 2072-2110.
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Costa, AA, Costa, LA & Vasconcelos, L 2023, 'Disentangling Reputational Effects in Alliances', Strategy Science, vol. 8, no. 3, pp. 349-367.
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An important consequence of an alliance is that partnering firms combine their reputations by associating them to jointly implemented projects. However, an often-overlooked aspect is that those reputations may themselves change due to both the announcement of the firms’ decision to form the alliance and the performance of joint projects. We develop a formal model that provides an integrated perspective of these reputational effects, while allowing us to isolate and characterize each of them. We find that the way in which the firms’ competence levels affect their decision to form an alliance determines how the firms’ reputations evolve following the announcement of the alliance and the performance of joint projects. This indicates that the analysis of the reputational effects of an alliance requires understanding the firms’ alliance formation decision in the first place. We show, for instance, that a firm’s reputation may decrease following the decision to form an alliance, and that the impact of project performance on the reputations of alliance partners can be very asymmetric. Among other things, our analysis implies that a firm’s desirability as an alliance partner does not necessarily increase with its reputation and level of competence.Funding: A. Almeida Costa and L. Almeida Costa thankfully acknowledge funding from the Fundação para a Ciência e a Tecnologia [Grants UID/ECO/00124/2019, UIDB/00124/2020, UIDP/00124/2020, and Social Sciences DataLab–PINFRA/22209/2016], as well as from POR Lisboa and POR Norte [Social Sciences DataLab–PINFRA/22209/2016].Supplemental Material: The e-companion is available at https://doi.org/10.1287/stsc.2022.0175 .

Girsberger, EM, Hassani-Nezhad, L, Karunanethy, K & Lalive, R 2023, 'Mothers at work: How mandating a short maternity leave affects work and fertility', Labour Economics, vol. 84, pp. 102364-102364.
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Hirata, D, Kasuya, Y & Tomoeda, K 2023, 'Weak stability against robust deviations and the bargaining set in the roommate problem', Journal of Mathematical Economics, vol. 105, pp. 102818-102818.
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Li, J, Mukherjee, A & Vasconcelos, L 2023, 'What Makes Agility Fragile? A Dynamic Theory of Organizational Rigidity', Management Science, vol. 69, no. 6, pp. 3578-3601.
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We present a novel explanation of why organizations tend to lose their agility over time despite their efforts to foster worker initiative in adapting to local information. Worker initiative ensures efficiency but requires strong incentives. When incentives are relational and the firm faces shocks to its credibility, it may adopt standardized work processes that ignore local information but yield satisfactory (though suboptimal) performance. The adoption of such standardized processes helps the firm survive the current shock but inflicts inefficiencies in the future. Although the firm may recover, it becomes more vulnerable to future shocks, and consequently, more reliant on the standardized work procedures. This paper was accepted by Joshua Gans, business strategy.

Suzuki, T 2023, 'Endogenous ambiguity and rational miscommunication', Journal of Economic Theory, vol. 211, pp. 105686-105686.
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This paper studies a sender-receiver game in which both players want the receiver to choose the state-optimal action. Before observing the state, the sender observes a “contextual signal,” a payoff-irrelevant signal that correlates with states and is imperfectly shared with the receiver. Once the sender observes the state, the sender sends a message to the receiver, incurring a small messaging cost. It is shown that there is no miscommunication in any efficient equilibrium if the messaging cost is uniform or contextual information is poorly shared between players. However, if the messaging costs are different between some messages, and contextual information can affect the probability ranking of states and is shared reasonably well, any efficient equilibrium that favors the sender exhibits miscommunication. Furthermore, the messages that cause miscommunication can be coarse or ambiguous, depending on how well players share contextual information.

Temnyalov, E 2023, 'An Information Theory of Efficient Differential Treatment', American Economic Journal: Microeconomics, vol. 15, no. 1, pp. 323-358.
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When are differential treatment policies—such as preferential treatment, affirmative action, and gender equity policies—justified by efficiency concerns? I propose a nonparametric assignment model where a policymaker assigns agents to different treatments or positions to maximize total surplus, based on the agents’ characteristics and noisy information about their types. I provide necessary and sufficient conditions on the agents’ signal structures, which characterize whether surplus maximization requires differential treatment or not, and study how the bias and informativeness of signal structures determine the efficiency implications of differential treatment. I examine implications of this model for inequality, decentralization, and empirical work. (JEL D63, D82, D83, I23, I24, J71)

Toner, P, Agarwal, R, Li, H, Bajada, C, Paul, S, Phan, Y, Pugalia, S & Green, R 2023, 'AUSTRALIAN BUSINESS MANAGEMENT IMPROVEMENT PROGRAMS: A CRITICAL ASSESSMENT', Journal of Australian Political Economy, vol. 2023, no. 91, pp. 31-55.

Van Essen, M & Wooders, J 2023, 'Dual auctions for assigning winners and compensating losers', Economic Theory, vol. 76, no. 4, pp. 1069-1114.
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Attree, K, Gainsford, A, Sainty, R, Bajada, C & Manton, D 1970, 'From compliance to collaboration: critically reflecting on the process of embedding an Indigenous Graduate Attribute in an undergraduate business program.', 36th ANZAM Conference: Changing management values and practices for a sustainable future, ANZAM, Wellington, New Zealand, pp. 790-805.
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Calls for Australian universities to embed Indigenous content into curriculum are more than a decade old yet this work remains largely incomplete. Institutional commitments made at senior level to achieve these outcomes can lack direction, guidance, and support at the coalface. Using a critical reflection methodology this paper outlines the approach undertaken by a group of Indigenous and non-Indigenous academics to embed a contextualised Indigenous graduate attribute into a traditional undergraduate business degree with multiple majors. The results indicate that collaborative approaches based on relationships and trust and supported with clear guidelines and processes can achieve positive outcomes. A focus on professional capabilities can enhance non-Indigenous staff confidence to teach this content and allay concerns about misappropriation of Indigenous Knowledges.

Baddeley, M 2023, 'Peter E. Earl, Principles of Behavioral Economics: Bringing Together Old, New and Evolutionary Approaches', Springer Science and Business Media LLC, pp. 1037-1039.
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Burdon, S, Stewart, C, John, C, Bajada, C, Kang, K & Abedin, B 2023, 'Powering National Outcomes from New Digital Technologies: An analysis of government policies to maximize the economic and social benefits', Asian Productivity Organization.
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The accelerating advancement of digital technologies is providing a myriad of opportunities for nations, both economically and socially. This study was a collaboration between the Asian Productivity Organization (APO) and the University of Technology Sydney (UTS). It considered how APO member governments might approach the advancement of digital technologies to maximize benefits for their nations.Specifically, the study considered which digital technologies, industry sectors, and regulatory and policy initiatives had the greatest potential to deliver national outcomes in areas of economic growth, productivity, and social impact.Overall, the research found that virtually all countries believed that the latest wave of digital technologies would deliver significant economic and productivity growth and that having policies and regulations in place to support a digital economy was important. It also highlighted the different opportunities, constraints, and challenges that individual APO nations faced, which meant that a one-size approach would be inappropriate. So, this report outlines a range of approaches that can be employed by nations, depending on where a country is currently positioned on the spectrum of digital economic development. It provides an initial framework that can be applied to any country, and offers some useful generic approaches, while also proposing specific recommendations for countries at different stages of digital readiness.The study led us to segment APO member economies into four ‘digital economy’ groups: the embryonic, the nascent, the emergent, and the leaders. In addition, we paid particular attention to three exemplars or ‘case study countries,’ each representing a different level of economic development and digital maturity. These were: Indonesia (nascent), Malaysia (emergent), and the Republic of Korea (leaders). Individual countries can get feedback from this report, in the first instance, by considering their relative st...

Dearden, JA, Goldbaum, D & Shi, Q 2023, 'Customized Product Return Policies'.

Goldbaum, D 2023, 'False Leaders and Other Disruptions to a Leader’s Influence'.

Hafalir, I, Kojima, F & Yenmez, MB 2023, 'Efficient Market Design with Distributional Objectives', ACM, p. 849.
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In a matching market with distributional objectives, we study the existence of mechanisms that weakly improve the distributional objective (compared to a status-quo matching), and satisfy constrained efficiency, individual rationality, and strategy-proofness.