A Model of Trading in the Art Market


American Economic Review

mars 2018, vol. 108, n°3, pp.744-774

Départements : Finance, GREGHEC (CNRS)

Mots clés : art; auctions; endogenous trading; price indexes; private values; returns

We present an infinite-horizon model of endogenous trading in the art auction market. Agents make purchase and sale decisions based on the relative magnitude of their private use value in each period. Our model generates endogenous cross-sectional and time-series patterns in investment outcomes. Average returns and buy-in probabilities are negatively correlated with the time between purchase and resale (attempt). Idiosyncratic risk does not converge to zero as the holding period shrinks. Prices and auction volume increase during expansions. Our model finds empirical support in auction data and has implications for selection biases in observed prices and transaction-based price indexes

Belief-free price formation


Journal of Financial Economics

février 2018, vol. 127, pp.342-365

Départements : Finance, GREGHEC (CNRS), Economie et Sciences de la décision

Mots clés : Financial market microstructure, Informed dealers, Price volatility, Belief-free equilibria

We analyze security price formation in a dynamic setting in which long-lived dealers re- peatedly compete for the opportunity to trade with short-lived retail traders. We charac- terize equilibria in which dealers’ pricing strategies are optimal irrespective of the private information that each dealer may possess. Thus, our model’s predictions are robust to dif- ferent specifications of the dealers’ information structure. These equilibria reconcile, in a unified and parsimonious framework, price dynamics that are reminiscent of well-known stylized facts: excess price volatility, price to trading flow correlation, stochastic volatility and inventory-related trading

Collaborative Prototyping of Alternative Designs Under a Target Costing Scheme


Production and Operations Management

mars 2018, vol. 27, n°3, pp.496–515

Mots clés : Collaborative prototyping, Parallel and sequential testing, Supplier involvement, Target costing

Prototyping allows firms to evaluate the technical feasibility of alternative product designs and to better estimate their costs. We study a collaborative prototyping scenario in which a manufacturer involves a supplier in the prototyping process by letting the supplier make detailed design choices for critical components and provide prototypes for testing. While the supplier can obtain private information about the costs, the manufacturer uses target costing to gain control over the design choice. We show that involving the supplier in the prototyping process has an important influence on the manufacturer's optimal decisions. The collaboration results in information asymmetry, which makes parallel prototyping less attractive and potentially reverses the optimal testing sequence under sequential prototyping: It may be optimal to test designs in increasing order of attractiveness to avoid that the supplier does not release technically and economically feasible prototypes for strategic reasons. We also find that the classical target costing approaches (cost- and market-based) need to be adjusted in the presence of alternative designs: Due to the strategic behavior of suppliers, it is not always optimal to provide identical target costs for designs with similar cost and performance estimates, nor to provide different target costs for dissimilar designs. Furthermore, the timing is important: While committing upfront to carefully chosen target costs reduces the supplier's strategic behavior, in some circumstances, the manufacturer can take advantage of this behavior by remaining flexible and specifying the second prototype's target costs later

Construction of Relations with Distant Suppliers on the Cognitive and Relational Dimensions to Co-Explore Discontinuous Innovations / Construction des relations avec des fournisseurs distants sur les plans cognitifs et relationnels pour co-explorer des in


Innovations, Revue d’économie et de management de l'innovation

2018, vol. 1, n°55, pp.61-87

Départements : GREGHEC (CNRS)

Mots clés : innovation discontinue, implication des fournisseurs, fournisseurs distants, open innovation, exploration, organisation ambidextre / discontinuous innovation, suppliers contribution, distant suppliers, open innovation, exploration, organizational ambidextry

Co-explorer des concepts avec des fournisseurs distants, sur les plans cognitifs et relationnels, favorise l’identification d’innovations discontinues. Cependant, peu de travaux s’intéressent aux modalités de construction de ces relations. Sur la base d’une étude longitudinale d’une entreprise qui a co-exploré des innovations discontinues avec des fournisseurs distants, nous mettons en évidence de manière inductive deux caractéristiques du processus et de l’organisation adoptée pour construire ces relations. Nous soulignons la transparence du processus de co-exploration qui soutient un engagement progressif mutuel. Ce processus est porté par un acteur dédié, ayant accès à la fois aux experts techniques ainsi qu’aux dirigeants de l’entreprise qui prennent les décisions stratégiques en matière de domaines d’innovation et de développement. Cet acteur est ainsi un des vecteurs de l’ambidextrie organisationnelle de l’entreprise puisqu’il permet le développement de ces relations parallèlement aux relations de long terme avec des partenaires privilégiés

Investigating the drivers for social commerce in social media platforms: Importance of trust, social support and the platform perceived usage


Journal of Retailing and Consumer Services

mars 2018, vol. 41, pp.11-19

Mots clés : Social commerce; S-vendors; Trust; Social media; Social support; UTAUT2 Model

This study sheds light on the drivers of social commerce in social media platforms. First, it explores the perceived characteristics of the social commerce vendor and investigates their influence on users’ trust. Second, it tests the influence of trust and the platform perceived usage (using the Unified Technology Acceptance and Use of Technology Model 2) on social commerce intent. Data from a survey of Instagram users, within the Golf Corporation Council countries, were collected online. Results show that reputation and price advantage have the strongest influence on trust, although those effects are weakened by habits. Contrary to expectations, social interactions with the social commerce vendor decrease trust. Similarly, product differentiation reduces trust. Nevertheless, this effect is negatively moderated by social support. Perceived ease of use of the platform, facilitating conditions, hedonic motives and habits increase social commerce intent. The findings of this research offer some insights on the mechanisms through which the s-vendor characteristics influence social commerce intent on social media platforms. Findings help businesses better understand the social commerce landscape and improve their marketing strategies

Optimizing Service Failure and Damage Control


International Journal of Research in Marketing

mars 2018, vol. 35, n°1, pp.100-115

Départements : Marketing, GREGHEC (CNRS)

Mots clés : Service Quality, Service Reliability, Service Failure, Damage Control

Should a provider deliver a reliable service or should it allow for occasional service failures? This paper derives conditions under which randomizing service quality can benefit the provider and society. In addition to cost considerations, heterogeneity in customer damages from service failures allows the provider to generate profit from selling damage prevention services or offering compensation to high-damage customers. This strategy is viable even when reputation counts and markets are competitive

Risk analysis and decision theory: A bridge


European Journal of Operational Research

janvier 2018, vol. 264, n°1, pp.280-293

Mots clés : Decision analysis, Risk analysis, Decision theory, Epistemic uncertainty

The risk-triplet approach pioneered by Kaplan and Garrick is the keystone of operational risk analysis. We perform a sharp embedding of the elements of this framework into the one of formal decision theory, which is mainly concerned with the methodological and modeling issues of decision making. The aim of this exercise is twofold: on the one hand, it gives operational risk analysis a direct access to the rich toolbox that decision theory has developed, in the last decades, in order to deal with complex layers of uncertainty; on the other, it exposes decision theory to the challenges of operational risk analysis, thus providing it with broader scope and new stimuli

The Impact of the French Doctrine of Significant Imbalance on International Business Transactions


Journal of Business Law

février 2018, n°2, pp.148-168

Départements : Droit et fiscalité, GREGHEC (CNRS)

Mots clés : Applicable law; Commercial contracts; France; Inequality of bargaining power; Unfair contract terms

This article examines the concept of “significant imbalance” (SI) under Frenchlaw and its impact on international business transactions. “Significant imbalance” is a legal standard meant to assess whether a contractual clause is unfair (abusive). Although initially restricted to consumer law, it has been extended to general contract law with the implementation of a reform entered into force on 1 October 2016. Previously, the Commercial Court of Parisin the ruling Ministry of Economy v Expedia, Inc (2015) had qualified SI as an “overriding mandatory provision” (loi de police) under Regulation 593/2008 on the applicable law to contractual obligations (Rome I). As a consequence, SI became operative in respect of international contracts despite an express choice of a foreign governing law made by the parties to the transaction. This article argues that, as a result of Expedia and the 2016 reform, French courts can interfere with international business transactions by striking down contractual terms that they deem unfair according to the SI standard. The analysis focuses on two key issues. On the one hand, notwithstanding recent judicial precedents, SI still fails to provide a reliable test for predicting which clauses or contracts are at risk of being deemed unfair. On the other hand, the legal arsenal supporting the French legislator’s disapproval of SI allocates great powerto French courts and the French Government to pursue tort lawsuits against foreign companies allegedly oppressing their commercial partners with SI clauses. Empirical evidence shows that these actions are highly successful compared with those commenced by private actors. The article concludesthat all these aspects, together with SI’s turbulent case law throughout the years, will give rise to uncertainty in international business transactions and may eventually disadvantage France in the global competition in such a field