Redesigning Teams and Incentives in a Merger: An Experiment with Managers and Students

Montmarquette, Claude; Rullière, Jean-Louis; Villeval, Marie Claire; Zeiliger, Romain

doi:10.1287/mnsc.1040.0280

Cited by 53 publications

(31 citation statements)

References 24 publications

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“…This score measures the intensity of the pull-to-center bias, with a value closer to 0 indicating a stronger bias and a value closer to 1 indicating a closer-to-optimal decision. Using random-effects GLMs to test treatment effects is a well-established methodology (e.g., Montmarquette et al 2004Montmarquette et al ,Özer et al 2011. The detailed regression models and estimates are presented in Appendix D.…”

Section: Do Chinese and Us Participants Make Different Newsvendor Dmentioning

confidence: 99%

Trust, Trustworthiness, and Information Sharing in Supply Chains Bridging China and the United States

2014

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Whether and how trust and trustworthiness differ between a collectivist society, e.g., China, and an individualistic one, e.g., the U.S., generate much ongoing scientific debate and bear significant practical values for managing cross-country transactions. We experimentally investigate how supply chain members' countries of origin -China versus the U.S. -affect trust, trustworthiness, and strategic information sharing behavior in a cross-country supply chain. We consider a two-tier supply chain in which the upstream supplier solicits demand forecast information from the retailer to plan production; but the retailer has an incentive to manipulate her forecast to ensure abundant supply. The levels of trust and trustworthiness in the supply chain and supplier's capability to determine the optimal production quantity affect the efficacy of forecast sharing and the resulting profits. We develop an experimental design to disentangle these three aspects and to allow for real-time interactions between geographically distant and culturally heterogeneous participants. We observe that, when there is no prospect for long-term interactions, our Chinese participants consistently exhibit lower spontaneous trust and trustworthiness than their U.S. counterparts do. We quantify the differences in trust and trustworthiness between the two countries, and the resulting impact on supply chain efficiency. We also show that Chinese individuals exhibit higher spontaneous trust towards U.S. partners than Chinese ones, primarily because they perceive that individuals from the U.S. are more trusting and trustworthy in general.This positive perception towards U.S. people is indeed consistent with the U.S. participants' behavior in forecast sharing. In addition, we quantify that a Chinese supply chain enjoys a larger efficiency gain from repeated interactions than a U.S. one does, as the prospect of building a long-term relationship successfully sustains trust and trustworthiness by Chinese partners. We advocate that companies can reinforce the positive perception of Westerners held by the Chinese population and commit to long-term relationships to encourage trust by Chinese partners. Finally, we also demonstrate that both populations exhibit similar pull-to-center bias when solving a decision problem under uncertainty (i.e., the newsvendor problem).*

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Section: Do Chinese and Us Participants Make Different Newsvendor Dmentioning

confidence: 99%

Trust, Trustworthiness, and Information Sharing in Supply Chains Bridging China and the United States

2014

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“…Bridger and Long 1984) and is also used in Montmarquette et al (2004) and Pingle (1995Pingle ( , 1997. In other economic experiments real e¤ort takes the form of solving mazes on the computer (Gneezy 2003), putting letters into envelopes (Falk and Ichino 2003), cracking walnuts (Fahr and Irlenbusch 2000), or answering GMAT-type of test questions (Gneezy and Rustichini 2000).…”

Section: Experimental Designmentioning

confidence: 99%

Performance measurement, expectancy and agency theory: An experimental study

Sloof

Praag

2008

Journal of Economic Behavior & Organization

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Theoretical analyses of (optimal) performance measures are typically performed within the realm of the linear agency model. An important implication of this model is that, for a given compensation scheme, the agent's optimal e¤ort choice is unrelated to the amount of noise in the performance measure. In contrast, expectancy theory as developed by psychologists predicts that e¤ort levels are increasing in the signal-to-noise ratio. We conduct a real e¤ort laboratory experiment to assess the relevance of this prediction in a setting where all key assumptions of the linear agency model are met. Moreover, our experimental design allows us to control expectancy exactly as in Vroom's (1964) original expectancy model. In this setting, we …nd that e¤ort levels are invariant to changes in the distribution of the noise term, i.e. to expectancy. Our results thus con…rm standard agency theory and reject this particular aspect of expectancy theory.

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“…The task, first used in Montmarquette et al (2005), consists of the search of the highest value of a function in a twodimensional space defined vertically by height and horizontally by distance from the origin. The curve corresponding to this function is increasing, with a maximum of three plateaus.…”

Section: Design Of the Taskmentioning

confidence: 99%