Related papers: Market Share Indicates Quality
In this paper we seek to understand the relationship between the online popularity of an article and its intrinsic quality. Prior experimental work suggests that the relationship between quality and popularity can be very distorted due to…
We study a setting in which a data buyer seeks to estimate an unknown parameter by purchasing samples from one of K data sellers. Each seller has privately known data quality (e.g., high vs. low variance) and a private per-sample cost. We…
Recommendation systems are pervasive in the digital economy. An important assumption in many deployed systems is that user consumption reflects user preferences in a static sense: users consume the content they like with no other…
Quantitative characterizations and estimations of uncertainty are of fundamental importance in optimization and decision-making processes. Herein, we propose intuitive scores, which we call certainty and doubt, that can be used in both a…
In evaluating prediction markets (and other crowd-prediction mechanisms), investigators have repeatedly observed a so-called "wisdom of crowds" effect, which roughly says that the average of participants performs much better than the…
We introduce a simple framework in which market participants update their prior about an efficient price with a model-based learning process. We show that exponential intensities for the arrival of aggressive orders arise naturally in this…
We develop SHOPPER, a sequential probabilistic model of shopping data. SHOPPER uses interpretable components to model the forces that drive how a customer chooses products; in particular, we designed SHOPPER to capture how items interact…
Over the last decades, a considerable amount of empirical knowledge about the efficiency of defect-detection techniques has been accumulated. Also a few surveys have summarised those studies with different focuses, usually for a specific…
The quality of a Bayes factor crucially depends on the number of regressors, the sample size and the prior on the regression parameters, and hence it has to be established in a case-by-case basis. In this paper we analyze the consistency of…
In various markets where sellers compete in price, price oscillations are observed rather than convergence to equilibrium. Such fluctuations have been empirically observed in the retail market for gasoline, in airline pricing and in the…
An analytic model is presented that considers the evolution of a market of durable goods. The model suggests that after introduction goods spread always according to a Bass diffusion. However, this phase will be followed by a diffusion…
In many markets, like electricity or cloud computing markets, providers incur large costs for keeping sufficient capacity in reserve to accommodate demand fluctuations of a mostly fixed user base. These costs are significantly affected by…
We study how loyalty behavior of customers and differing costs to produce undifferentiated products by firms can influence market outcomes. In prior works that study such markets, firm costs have generally been assumed negligible or equal,…
Due to their intuitive appeal, Bayesian methods of modeling and uncertainty quantification have become popular in modern machine and deep learning. When providing a prior distribution over the parameter space, it is straightforward to…
Confidence interval of mean is often used when quoting statistics. The same rigor is often missing when quoting percentiles and tolerance or percentile intervals. This article derives the expression for confidence in percentiles of a sample…
Most online markets establish reputation systems to assist building trust between sellers and buyers. Sellers' reputations not only provide guidelines for buyers but may also inform sellers their optimal pricing strategy. In this research,…
In this paper I empirically investigate prediction markets for binary options. Advocates of prediction markets have suggested that asset prices are consistent estimators of the "true" probability of a state of the world being realized. I…
This paper investigates the value of recommendations for disseminating economic information, with a focus on frictions resulting from preference heterogeneity. We consider Bayesian expected-payoff maximizers who receive non-strategic…
Different from shopping at retail stores, consumers on e-commerce platforms usually cannot touch or try products before purchasing, which means that they have to make decisions when they are uncertain about the outcome (e.g., satisfaction…
We suggest that one individual holds multiple degrees of belief about an outcome, given the evidence. We then investigate the implications of such noisy probabilities for a buyer and a seller of binary options and find the odds agreed upon…