When choosing between incompatible technologies that are characterized by network effects in business or consumer markets, e.g., software (Microsoft vs. Open Source) or “Walkie-Talkie” phones (Direct Connect vs. Push to Talk), customers must decide between compatibility with others and individual fit. Given differing customer preferences, we study the adoption dynamics and pricing strategies of...

I the extensive literature on learning curves, scholars have ignored outcome measures of organizational performance evaluated by customers. We explore whether customer dissatisfaction follows a learning-curve pattern. Do organizations learn to reduce customer dissatisfaction? Customer dissatisfaction occurs when customers’ ex ante expectations about a product or service exceed ex post perceptio...

Retirement policies often seek to set pensions at levels that enable single and married pensioners to have the same standard of living. The existing literature on consumer equivalence scales provides little assistance to this policy objective as the estimated scales are not very precise and rely on strong and opaque assumptions. This paper proposes an alternative strategy which involves the use...

Abstract Many firms are beginning to replace customer service employees with bots, from humanoid robots digital chatbots. Using real human–bot interactions in lab and field settings, we study consumers’ evaluations of bot-provided service. We find that more negative when the provider is a bot versus human—even provided identical. This effect explained by belief automation motivated firm benefit...

Assume that the surplus of an insurer follows a compound Poisson surplus process. When the surplus is below zero or the insurer is on deficit, the insurer could borrow money at a debit interest rate to pay claims. Meanwhile, the insurer will repay debts from her premium income. The negative surplus may return to a positive level if debts are reasonable. However, when the negative surplus is bel...