Voluntary environmental labeling or certification programs provide information about the environmental characteristics of one or more aspects of a product’s life cycle to consumers. The U.S. Environmental Protection Agency and Department of Energy were among the first governmental agencies in the world to adopt environmental information programs. This study examines two U.S. programs – Energy Star, an energy efficiency labeling program, and Green Power Partnership (GPP), a green energy purchasing program, and estimates how much consumers are willing to pay for refrigerators that have been awarded these labels and what factors motivate that willingness to pay. The data were obtained from a survey conducted in March and April of 2009 via an online research panel, which was constructed to be representative of the U.S. population. Analysis of the data was conducted using conditional logit regression models with fixed parameters and mixed logit regression models with random parameters. Results revealed that consumers, on average, have a willingness to pay ranging from $237.81 to $350.54 for the Energy Star label and a willingness to pay ranging from $48.52 to $70.95 for the GPP label. The results also indicate that consumer demographics and attitudes influence WTP. In particular, individuals with greater levels of stated concern for the environment or individuals exhibiting strong perceptions on the effectiveness of consumers to affect product design and the ambient environment had a greater likelihood of choosing a labeled alternative, and thus, a greater WTP for both the Energy Star and GPP label. To manufacturers and government regulators, these results suggest that energy labels can play a significant role in a consumer’s decision making process when selecting a new appliance.

The purpose of this thesis is to examine if professional investors areindicating tendencies of irrational behavior when exposed to certainpsychological dilemmas related to the financial world.

<p>This dissertation collects work concerning the way individuals deal with imperfect information, both related to their knowledge of themselves and of others. The second chapter shows that bounded rationality, in the form of limited knowledge of utility, is an explanation for common stylized facts of prospect theory like loss aversion, status quo bias and non-linear probability weighting. Locally limited utility knowledge is considered within a classical demand model framework, suggesting that costs of inefficient search for optimal consumption will produce a value function that obeys the loss aversion axiom of Tversky and Kahneman (1991). Moreover, since this adjustment happens over time, new predictions are made that explain why the status quo bias is reinforced over time. This search can also describe the behavior of a consumer facing an uncertain future wealth level. The search cost justifies non-linear forms of probability weighting. The effects that have been observed in experiments will follow as a consequence.</p><p>The third chapter looks to understand how firms create and maintain long term relationships with consumers, or how procurement relations evolve over time, by studying a dynamic variant of the classical two-type-buyer contract in mechanism design. It is less trivial and more interesting if the utility determinant (or utility type) is not fixed or completely random, and fair assumptions are that it is either stochastic, or given by a distribution whose parameters are common knowledge. The first approach is that of Battaglini (2005), while the second is pursued in this paper. With two possible types of buyers, the buyer more likely to have a high utility type will receive the first-best allocations, while the other will receive the first best only if he has the high utility type. </p><p>The last chapter analyzes a dynamic procurement setting with promise keeping, where two firms (agents) with private information on their costs contract competitively with a principal. To this end, two models are proposed and the optimal allocations are determined. The agents face liquidity constraints, which induce distortions when high marginal costs are reported. We deduce that the principal uses promised utilities to incentivize the agents, which act as state variables in the recursive maximization problem. High cost types are allocated less than efficient quantities and the inefficiency of the allocation is relieved as the promised utilities increase.</p> / Dissertation

In developing countries, remittances play a key role as a source of external finance. Remittances are a form of aid that migrant workers send back to their families, located in their home countries, in order to support the needs of the household. In about 25% of developing countries, remittances are larger than public and private capital flows combined (International Monetary Fund, 2009). In 2008, the Philippines economy was the 47th largest economy in the world with a GDP of $322 billion dollars (Asian Development Bank, Fact Sheet). Remittances accounted for over 10% of the Philippine economy, making the Philippines one of the world’s highest remittance receiving countries. Using a probit model and an OLS regression model focusing on the Philippines in 2003, this paper will focus on exploring what variables influence the decision to send a household member away for work, what factors contribute to whether or not a household receives a remittance and if they do, how these same characteristics affect the value of the remittance.

92 students from a Southern California liberal arts college and two Beijing universities participated in an online questionnaire. Their cultural tendencies (i.e. level of collectivism and perception of family support) and responses to hypothetical investment scenarios were observed. Participants were asked to provide the amount they would invest in each scenario as well as a risk safety rating. The Chinese respondents reported higher cushion and collectivism scores than the Americans. Furthermore, the Chinese sample offered more money for the three riskiest scenarios; they also rated three scenarios safer than the Americans did. The cushion and collectivism scores were not found to predict risk appraisal and amount invested in the scenarios. The results suggest that cultural biases may have an impact on the financial risk-taking behavior of different peoples, but other cultural variables and situational determinants may play an equally influential role in affecting risk perception and investment behavior.

As corporate sponsorship of sporting events becomes a more popular marketing tool, the price tag associated with these sponsorship agreements has steepened considerably. Over the past thirty years, sponsorship has become an integral part of the Olympic Games. In this paper, we employ an event study methodology to assess the impact of both the Vancouver 2010 Winter Olympic Games and the performance of Canadian Olympic athletes on the shareholder value of national Olympic sponsors. We hypothesize, in line with current behavioral finance research, that the national Olympic sponsors will capitalize on the positive mood and attention associated with the Games in such a way that Olympic sponsorship will positively impact shareholder value. However, we find that, from a stock return perspective, corporate sponsorship of the Vancouver 2010 Olympic Games is not a value-adding investment. We find that while the market index is positively impacted by both the Olympic Games and Canadian medalists, there is a negative and significant impact of the Olympic Games on national sponsors. Furthermore, Canadian medalists have a positive impact on the stock returns of three individual sponsors, but these winners' effects are negative for two sponsors and insignificant for another two sponsors.

I combine theory, experiments and econometrics to undertake the task of disentangling the subtleties and implications of the distinction between risk, uncertainty and ambiguity. One general conclusion is that the elements of this methodological trilogy are not equally advanced. For example, new experimental tools must be developed to adequately test the predictions of theory. My dissertation is an example of this dynamic between theoretical and applied economics.

<p>The purpose of this thesis is to examine if professional investors areindicating tendencies of irrational behavior when exposed to certainpsychological dilemmas related to the financial world.</p>

Voluntary environmental labeling or certification programs provide information about the environmental characteristics of one or more aspects of a product’s life cycle to consumers. The U.S. Environmental Protection Agency and Department of Energy were among the first governmental agencies in the world to adopt environmental information programs. This study examines two U.S. programs – Energy Star, an energy efficiency labeling program, and Green Power Partnership (GPP), a green energy purchasing program, and estimates how much consumers are willing to pay for refrigerators that have been awarded these labels and what factors motivate that willingness to pay. The data were obtained from a survey conducted in March and April of 2009 via an online research panel, which was constructed to be representative of the U.S. population. Analysis of the data was conducted using conditional logit regression models with fixed parameters and mixed logit regression models with random parameters. Results revealed that consumers, on average, have a willingness to pay ranging from $237.81 to $350.54 for the Energy Star label and a willingness to pay ranging from $48.52 to $70.95 for the GPP label. The results also indicate that consumer demographics and attitudes influence WTP. In particular, individuals with greater levels of stated concern for the environment or individuals exhibiting strong perceptions on the effectiveness of consumers to affect product design and the ambient environment had a greater likelihood of choosing a labeled alternative, and thus, a greater WTP for both the Energy Star and GPP label. To manufacturers and government regulators, these results suggest that energy labels can play a significant role in a consumer’s decision making process when selecting a new appliance.

This paper investigates the influence of two representative other-regarding preferences on specified issues. The first chapter studies the preferred tax rate and labor supplies of voters in the presence of income inequality aversion in a two-stage redistribution game. The two-stage redistribution game consists of a first stage in which voters vote for a flat tax rate on income with the revenues redistributed evenly and a second stage in which workers, who are also voters, provide the labor supplies with the tax rate given. I specify inequality aversion preferences into two ways: The payoff inequality aversion represents people's preference to divide their material payoff evenly, and the income inequality aversion represents people's preference to divide their income evenly without considering their efforts to earn that income. In conclusion, payoff inequality-averse workers provide the same labor supplied as a worker who does not have any inequality aversions (a standard worker) but prefers a higher tax rate to a standard worker. The income inequality-averse workers, first, provide their labor supply considering their positions in a skill distribution and, therefore, adjust their labor supply such that the income curve becomes flatter. High-skilled workers tend to earn less income, while low-skilled workers tend to earn more income. Second, the income share of the richest decreases with the degree of inequality aversion up to a point. Third, inequality-averse workers do not necessarily prefer a higher tax rate to a standard worker, mainly because some level of income inequality is already self-adjusted in the second stage. The second chapter looks at how reciprocal preferences influence coalition size in international environmental agreements. Reciprocal preferences represent how a decision maker gains an additional positive utility when it responds to a kind action with a kind action or to an unkind action with an unkind action. I incorporate reciprocal preferences in a two-stage game that predicts the decision of each government to participate in an agreement that decreases pollutant emissions. The main result shows that bigger coalition forms than the standard preference does not include reciprocal preferences. Reciprocal governments that participate in the treaty (signatories) suffer from unkindness based on pollution by non-signatories so that the threat to retaliate by polluting becomes credible. Then, free-rider governments (non-signatories) on the margin surrender to the implicit threat and participate in the treaty. Furthermore, including reciprocity reverses the usual result that there is an inverse relationship between the marginal benefit and coalition size. In other words, the size of coalition increases with the marginal benefit of abatement in an equilibrium when the reciprocal sensitivity is sufficiently high. Signatories are more likely to retaliate against non-signatories because the benefit to non-signatories of refraining from decreasing emissions aggravates the unkindness to signatories.