http://repub.eur.nl/res/concept/jel-O32/ Recent publications classified by JEL Code O32 en http://repub.eur.nl/static-eur/img/logo.png http://repub.eur.nl http://repub.eur.nl/res/pub/40144/ 2013-05-22T00:00:00Z Information systems have revolutionized the provisioning of decision-relevant information, and decision support tools have improved human decisions in many domains. Autonomous decision- making, on the other hand, remains hampered by systems’ inability to faithfully capture human preferences. We present a computational preference model that learns unobtrusively from lim- ited data by pooling observations across like-minded users. Our model quantifies the certainty of its own predictions as input to autonomous decision-making tasks, and it infers probabilistic segments based on user choices in the process. We evaluate our model on real-world preference data collected on a commercial crowdsourcing platform, and we find that it outperforms both individual and population-level estimates in terms of predictive accuracy and the informative- ness of its certainty estimates. Our work takes an important step toward systems that act autonomously on their users’ behalf. Peters, M. Ketter, W. http://repub.eur.nl/res/pub/40138/ 2013-05-22T00:00:00Z This is the specification for the Power Trading Agent Competition for 2013 (Power TAC 2013). Power TAC is a competitive simulation that models a “liberalized” retail electrical energy market, where competing business entities or “brokers” offer energy services to customers through tariff contracts, and must then serve those customers by trading in a wholesale market. Brokers are challenged to maximize their profits by buying and selling energy in the wholesale and retail markets, subject to fixed costs and constraints. Costs include fees for publication and withdrawal of tariffs, and distribution fees for transporting energy to their contracted customers. Costs are also incurred whenever there is an imbalance between a broker’s total contracted energy supply and demand within a given time slot. The simulation environment models a wholesale market, a regulated distribution utility, and a population of energy customers, situated in a real location on Earth during a specific period for which weather data is available. The wholesale market is a relatively simple call market, similar to many existing wholesale electric power markets, such as Nord Pool in Scandinavia or FERC markets in North America, but unlike the FERC markets we are modeling a single region, and therefore we do not model location-marginal pricing. Customer models include households and a variety of commercial and industrial entities, many of which have production capacity (such as solar panels or wind turbines) as well as electric vehicles. All have “real-time” metering to support allocation of their hourly supply and demand to their subscribed brokers, and all are approximate utility maximizers with respect to tariff selection, although the factors making up their utility functions may include aversion to change and complexity that can retard uptake of marginally better tariff offers. The distribution utility models the regulated natural monopoly that owns the regional distribution network, and is responsible for maintenance of its infrastructure and for real-time balancing of supply and demand. The balancing process is a market-based mechanism that uses economic incentives to encourage brokers to achieve balance within their portfolios of tariff subscribers and wholesale market positions, in the face of stochastic customer behaviors and weather-dependent renewable energy sources. The broker with the highest bank balance at the end of the simulation wins. Ketter, W. Collins, J. Reddy, P. Weerdt, M.M. de http://repub.eur.nl/res/pub/38149/ 2012-12-21T00:00:00Z In order to promote the generation of market breakthroughs and disruptive innovation, organizations increasingly promote grassroots innovation, i.e. the emergence of innovative ideas from their whole employee base. Despite this surge in interest in grassroots innovation, there is a lack of guidance on how organizations should design and implement grassroots innovation programs. A key challenge faced by organizations promoting grassroots innovation is how to motivate the right employees to submit their best ideas and persist in their quest to transform such ideas in successful new businesses. In this paper, we draw on self-determination theory (SDT) to propose a conceptual framework that organizations can use to design effective grassroots innovation programs. We offer an in-depth understanding of how top-management support and the mechanisms behind grassroots innovation programs (e.g., idea sourcing, team formation, team/idea selection and training/coaching) influence employees’ motivation to submit their best ideas and, consequently, the success of grassroots innovation programs. We argue, in line with SDT, that successful grassroots innovation programs need to promote employees’ intrinsic motivation for innovation by satisfying three innate human needs: competence, autonomy and relatedness. Through an in-depth case study (the Innospire program at Merck), we provide evidence that support our propositions and discuss how organizations can successfully implement the proposed framework. Betz, U.A.K. Camacho, N.M.A. Gerards, M. Stremersch, S. http://repub.eur.nl/res/pub/37192/ 2012-09-10T00:00:00Z This is the specification for the Power Trading Agent Competition for 2012 (Power TAC 2012). Power TAC is a competitive simulation that models a “liberalized” retail electrical energy market, where competing business entities or “brokers” offer energy services to customers through tariff contracts, and must then serve those customers by trading in a wholesale market. Brokers are challenged to maximize their profits by buying and selling energy in the wholesale and retail markets, subject to fixed costs and constraints. Costs include fees for publication and withdrawal of tariffs, and distribution fees for transporting energy to their contracted customers. Costs are also incurred whenever there is an imbalance between a broker’s total contracted energy supply and demand within a given time slot. The simulation environment models a wholesale market, a regulated distribution utility, and a population of energy customers, situated in a real location on Earth during a specific period for which weather data is available. The wholesale market is a relatively simple call market, similar to many existing wholesale electric power markets, such as Nord Pool in Scandinavia or FERC markets in North America, but unlike the FERC markets we are modeling a single region, and therefore we do not model location-marginal pricing. Customer models include households and a variety of commercial and industrial entities, many of which have production capacity (such as solar panels or wind turbines) as well as electric vehicles. All have “real-time” metering to support allocation of their hourly supply and demand to their subscribed brokers, and all are approximate utility maximizers with respect to tariff selection, although the factors making up their utility functions may include aversion to change and complexity that can retard uptake of marginally better tariff offers. The distribution utility models the regulated natural monopoly that owns the regional distribution network, and is responsible for maintenance of its infrastructure and for real-time balancing of supply and demand. The balancing process is a market-based mechanism that uses economic incentives to encourage brokers to achieve balance within their portfolios of tariff subscribers and wholesale market positions, in the face of stochastic customer behaviors and weather-dependent renewable energy sources. The broker with the highest bank balance at the end of the simulation wins. Ketter, W. Collins, J. Reddy, P. Weerdt, M.M. de http://repub.eur.nl/res/pub/31775/ 2012-02-07T00:00:00Z We formulate a simple model of optimal defensive disclosure by a monopolist facing uncertain antitrust enforcement and test its implications using unique data on defensive disclosures and patents by IBM during 1955-1989. Our results indicate that stronger antitrust enforcement leads to more defensive disclosure, that quality inventions are disclosed defensively, and that defensive disclosure served as an alternative but less successful mechanism to patenting at IBM in appropriating returns from R&D. Bhaskarabhatla, A. Pennings, H.P.G. http://repub.eur.nl/res/pub/32154/ 2011-09-01T00:00:00Z Dual distribution in franchising is addressed from an incomplete contracting perspective. We explicitly model cooperative (dual distribution) franchising as an organizational form, next to wholly-owned, wholly-franchised, and dual distribution franchise systems. Key conclusions of the model are: (1) dual distribution as an efficient governance mechanism does not depend on heterogeneous downstream outlets, and (2) whether dual distribution or some other organizational form is efficient depends on the size of the benefits to dual distribution relative to the parties' costs of investing. Hendrikse, G.W.J. Jiang, T. http://repub.eur.nl/res/pub/23550/ 2011-06-21T00:00:00Z A growing number of firms rely on strategic R&D alliances to develop new products. In these alliances, firms use various kinds of governance mechanisms for incentive alignment. Project-level governance, i.e., the daily control of alliance activities by firms’ alliance representatives such as steering committee members, alliance managers, and project managers; and, performance-based monetary incentives, i.e., the potential milestone payments tied to the performance of partners, are two governance mechanisms, increasingly used in practice, yet overlooked in the strategic alliances literature. In this dissertation, I examine the antecedents and performance outcomes of these two governance mechanisms in the biopharmaceutical industry setting. The results of this dissertation suggest that project-level governance and monetary incentives offset each others’ effects on alliance innovation performance in the context of startup-incumbent alliances. In other words, offering greater monetary incentives to startups has minimal positive effect on development success, if incumbents opt for intense project-level governance by their controllers at the same time. On the other hand, the results suggest that greater monetary incentives result in higher abnormal stock returns to startup firms following alliance announcements. The results also reveal the positive reciprocal relationship between project-level governance and monetary incentives. The greater the project-level governance, the higher the size of potential milestone-payments, and vice versa. Hence, the incumbents that exercise intense governance on startups in alliances offer also higher potential milestone payments to compensate for the performance risks of startups. The results also show that project-level governance positively influences the contractual detail, which in turn increases the likelihood of development success. Finally, the results reveal several other exogenous and endogenous antecedents of both governance mechanisms. Ozdemir, M.N. http://repub.eur.nl/res/pub/23492/ 2011-05-30T00:00:00Z This paper proposes a risk assessment framework as a research road-map, with the aim of developing a protocol that integrates the risk management requirements from the perspectives of the business and the government. We take the viewpoint of value modeling and interpret the risk management problem as a control problem. Four steps of risk assessment are identified in the framework, forming the risk management cycle. Liu, L. Daniels, H.A.M. http://repub.eur.nl/res/pub/23422/ 2011-05-26T00:00:00Z This thesis deals with the entrepreneurial process from an international perspective. The first part explores which people decide to enter entrepreneurship. A distinction is made between two modes of entrepreneurial entry: taking over an existing firm and starting a new firm. The second part focuses on the exit side and examines the determinants of exit before and exit after business start-up. In addition, the decision to re-enter entrepreneurship after having experienced an entrepreneurial exit is analyzed in this second part. This thesis is of particular interest to policymakers, partly due to its dynamic approach. That is, this thesis distinguishes between several stages that make up the decision to become an entrepreneur. The stages range from no entrepreneurial activity to intentional, nascent, young, and established entrepreneurship (the “entrepreneurial ladder”). The conclusions of this thesis may help governments to intervene at positions on the entrepreneurial ladder where certain characteristics, such as perceptions about the entrepreneurial environment, hinder entrepreneurial progress or where regions lag behind. We find that people with pessimistic views about the administrative start-up environment are discouraged in having intentions or undertaking attempts to set up their own businesses (particularly in Europe). Policies should be aimed at tackling inflated perceptions of administrative barriers (in case of misperceptions of the environment) or directly lowering these barriers. Exit before start-up and exit after business start-up have different determinants. For example, urbanization is negatively related to exit before start-up and positively related to exit after start-up. This finding points at the presence of overoptimistic entrepreneurs and strong selection mechanisms in these areas. Furthermore, individuals are inclined to enter the entrepreneurial process again after having experienced an exit. This finding holds true for positive as well as negative exit experiences. Zwan, P.W. van der http://repub.eur.nl/res/pub/23339/ 2011-05-16T00:00:00Z Many enterprises that participate in dynamic markets need to make product pricing and inventory resource utilization decisions in real-time. We describe a family of statistical models that address these needs by combining characterization of the economic environment with the ability to predict future economic conditions to make tactical (short-term) decisions, such as product pricing, and strategic (long-term) decisions, such as level of finished goods inventories. Our models characterize economic conditions, called economic regimes, in the form of recurrent statistical patterns that have clear qualitative interpretations. We show how these models can be used to predict prices, price trends, and the probability of receiving a customer order at a given price. These “regime” models are developed using statistical analysis of historical data, and are used in real-time to characterize observed market conditions and predict the evolution of market conditions over multiple time scales. We evaluate our models using a testbed derived from the Trading Agent Competition for Supply Chain Management (TAC SCM), a supply chain environment characterized by competitive procurement and sales markets, and dynamic pricing. We show how regime models can be used to inform both short-term pricing decisions and longterm resource allocation decisions. Results show that our method outperforms more traditional shortand long-term predictive modeling approaches. Ketter, W. Collins, J. Gini, M. Gupta, A. Schrater, P. http://repub.eur.nl/res/pub/23263/ 2011-05-10T00:00:00Z This is the specification for the Power Trading Agent Competition for 2011 (Power TAC 2011). Agents are simulations of electrical power brokers, who must compete with each other for both power production and consumption, and manage their portfolios. Ketter, W. Collins, J. Reddy, P. Flath, C. http://repub.eur.nl/res/pub/22815/ 2011-03-24T00:00:00Z Fruit and vegetable marketing organization The Greenery has experienced various governance structure changes, like horizontal merger, forward integration, and the emergence of grower associations. A multilateral incomplete contracting model is presented to account for these changes by analysing the interactions between pooling, access, and countervailing power. This model does not only explain the changes at The Greenery, but it contributes also to the design of efficient channel governance. Hendrikse, G.W.J. http://repub.eur.nl/res/pub/22812/ 2011-03-19T00:00:00Z This paper explores how standardization education can be implemented at the national level. Previous studies form the main source for the paper. This research shows that implementation of standardization in the national education system requires policy at the national level, a long term investment in support, and cooperation between industry, standardization bodies, academia, other institutions involved in education, and government. The approach should combine bottom-up and top-down. The paper is new in combining previous findings to an underpinned recommendation on how to implement standardization education. Vries, H.J. de http://repub.eur.nl/res/pub/22723/ 2011-03-02T00:00:00Z In this paper we present and analyze a model for clustering in networks that offer Software as a Service (SaaS). In this problem, organizations requesting a set of applications have to be assigned to clusters such that the costs of opening clusters and installing the necessary applications in clusters are minimized. We prove that this problem is NP-hard, and model it as an Integer Program with symmetry breaking constraints. We then propose a Tabu search heuristic for situations where good solutions are desired in a short computation time. Extensive computational experiments are conducted for evaluating the quality of the solutions obtained by the IP model and the Tabu Search heuristic. Experimental results indicate that the proposed Tabu Search is promising. Gaast, J.P. van der Rietveld, C.A. Gabor, A.F. Zhang, Y. http://repub.eur.nl/res/pub/22280/ 2011-01-27T00:00:00Z This study addresses the organization and strategy of firms in emerging markets with an explicit application to financial services. Given the relevance of a well-functioning financial system for economic growth, understanding the organization and strategy of firms contributing to the development of sound financial services appears of utmost importance for emerging markets. Throughout the study, two main providers of financial services are distinguished, namely banks and stock markets, which are examined in the emerging market context of Central and Eastern Europe and China, respectively. For banking, the general focus is on the adopted strategies of multinational banks to expand across the Central and Eastern European region. The main findings indicate that, based on the degree of host market uncertainty and competition, multinational banks adopt different expansion strategies. Furthermore, it appears that multinational banks expand most effectively by establishing new subsidiaries in countries adjacent to a country where the bank already has a presence. For stock markets, the central theme is how the decision of mainland Chinese firms on where to list their shares reflects the attractiveness of the stock markets within the financial centers of Shanghai, Shenzhen and Hong Kong. The findings suggest an increasing segregation in the strategic listing decisions that mainland Chinese firms make, which indicates that the financial centers of mainland China and Hong Kong have become more specialized and complementary over time. Karreman, B. http://repub.eur.nl/res/pub/22720/ 2011-01-17T00:00:00Z We determine the circumstances when the absence of public listing, often believed to be a disadvantage, makes a cooperative the unique efficient governance structure. This is established in a multi-task principal-agent model, capturing that cooperatives are not publicly listed and their CEOs have to bring the downstream enterprise to value as well as to serve upstream member interests. Not having a public listing prevents the CEO from choosing the level of the downstream activities too high. Cooperatives are uniquely efficient when the upstream marginal product multiplied with a function increasing in the strength of the chain complementarities is higher than the downstream marginal product. Feng, L. Hendrikse, G.W.J. http://repub.eur.nl/res/pub/21869/ 2011-01-01T00:00:00Z This paper investigates the antecedents and consequences of two product advantage components: product meaningfulness and product superiority. Product meaningfulness concerns the benefits that users receive from buying and using a new product, whereas product superiority concerns the extent to which a new product outperforms competing products. The present paper argues that scholars and managers should make a deliberate distinction between the two components because they are theoretically distinct and also have different antecedents and consequences. Data were collected through an online survey on 141 new products from high-tech companies located in The Netherlands. The results reveal that new products need to be meaningful as well as superior to competing products to be successful. This finding is consistent with the prevailing aggregate view on product advantage in the literature. However, the results also show that the effects of the two components on new product performance are moderated by market turbulence. Although each component is important in that it forms a necessary precondition for the other to affect new product performance under circumstances of moderate market turbulence, meaningfulness is most important for new product performance in turbulent markets where preferences have not yet taken shape. In contrast, when markets become more stable, the uniqueness of meaningful attributes decreases, and new products that provide advantage by fulfilling their functions in a way that is superior to competing products are more likely to perform well. In addition, the study shows that the firm's customer and competitor knowledge processes independently lead to product meaningfulness and superiority, respectively. The findings also reveal that under conditions of high technological turbulence the customer and competitor knowledge processes complement each other in creating product meaningfulness and superiority. This implies that the level of technological turbulence puts requirements on the breadth of firms' market knowledge processes to create a new product with sufficient advantage to become successful. The paper concludes that neglecting the distinction between product meaningfulness and superiority when assessing a new product's advantage may lead to an incomplete insight on how firms can improve the performance of their new products. Rijsdijk, S.A. Langerak, F. Hultink, E.J. http://repub.eur.nl/res/pub/22257/ 2011-01-01T00:00:00Z The relationship between outcome status and encountered problems in the business start-up process is investigated. Contrary to expectations, we find that starters do not substantially differ from quitters in the number and type of problems encountered, and that problems encountered generally do not affect outcome status. This research is based on a sample of 414 Dutch nascent entrepreneurs followed over a three-year period. Its design is comparable to that of the U.S. Panel Study of Entrepreneurial Dynamics. Gelderen, A.M. van Thurik, A.R. Pankaj, P. http://repub.eur.nl/res/pub/21914/ 2010-12-23T00:00:00Z Companies increasingly outsource activities to volunteers that they approach via an open call on the internet. The phenomenon is called ‘crowdsourcing’. For an effective use of crowdsourcing it is important to understand what motivated these online volunteers and what is the influence of rewards. Therefore, this thesis examines the effects of motivation and rewards on the participation and performance of online community members. We studied motivation, rewards and contributions in three crowdsourcing initiatives that varied in reward systems. The findings of these three studies resulted in a refined model of the effects of rewards and motivation on voluntary behavior. With this model we provide a possible solution for contrary findings in empirical studies of online communities and the ongoing debate between two schools of cognitive psychology. Our results also have important implications for organizers of online communities, amongst others, regarding the effective application of reward systems. We also provide a crowdsourcing typology in which crowdsourcing initiatives are classified on the basis of their reward systems and identify the motivation profiles of optimal performers per crowdsourcing type. Borst, W.A.M. http://repub.eur.nl/res/pub/22613/ 2010-12-10T00:00:00Z Traditional rolling stock rescheduling applications either treat passengers as static objects whose influence on the system is unchanged in a disrupted situation, or they treat passenger behavior as a given input. In case of disruptions however, we may expect the flow of passengers to change significantly. In this paper we present a model for passenger flows during disruptions and we describe an iterative heuristic for optimizing the rolling stock to the disrupted passenger flows. The model is tested on realistic problem instances of NS, the major operator of passenger trains in the Netherlands. Kroon, L.G. Maroti, G. Nielsen, L.K.