Reward the inductor or inductee? The effect of the inductee's altruism on a shopping guide platform

PurposeThis study highlights the effect of an inductee's altruism on referral reward programs (RRPs) on an online shopping guide platform to determine the optimal RRP and referral reward allocation under a Cashback and Referral RRP.Design/methodology/approachThe authors consider a Stackelberg game with a platform, seller, inductor and inductee, where the inductee's altruism plays a vital role in determining the optimal RRP in equilibrium.FindingsThe authors show that the conditions under which it is optimal to reward the inductor only or reward both inductor and inductee are equal or unequal depending on the degree of the inductee's altruism. Suppose the platform is unable to dynamically decide the commission fee. In that case, the platform may not always be involved in RRPs and will gradually reduce the rewards for inductees as the altruism increases.Research limitations/implicationsThis study focuses on a free-to-consumers model where sellers pay membership fees. Thus, this study has limitations regarding other pricing schemes such as a model in which consumers pay a fee while sellers do not or a model in which both types of users pay fees.Practical implicationsThis analytical work can help platforms optimize referral reward strategies and referral reward allocation considering the influence of an inductee's altruism.Originality/valueIn a Cashback and Referral RRP on a shopping guide platform, the authors provide applicable conditions for the platform to involve in the RRPs when rewarding an equal bonus for the inductor and inductee first. Further, the authors show the optimal referral reward strategy and referral reward allocation when giving the different bonuses to the inductor and inductee.

Educational Expansion, Skills Diffusion, and the Economic Value of Credentials and Skills

Examining the economic value of education has been a central research agenda of social scientists for decades. However, prior research inadequately accounts for the discrepancy between educational credentials and skills at both the individual and societal levels. In this article, I investigate the link between credentials, skills, and labor market outcomes against a background of societal-level educational expansion and skills diffusion. Using internationally comparable OECD data for approximately 30,000 individuals in 26 countries, I find that both credentials and skills generally contribute to occupational and monetary rewards. In particular, the premium for credentials far outweighs that for skills. This is in contrast to recent arguments that skills are the key to economic success. Nevertheless, returns to credentials decline in tandem with educational expansion, whereas skills retain their premium even as they diffuse in a given society. Furthermore, skills diffusion also leads to the diminishing monetary return to high credentials. These findings suggest that skills diffusion promotes more meritocratic reward allocation via devaluing high credentials without explicit depreciation of high skills.

Mutual Monitoring and Team Member Communication in Teams

ABSTRACT This study investigates whether the benefit firms can extract from team member communication to the team manager—who may use such information for rewarding individual team members—is affected by differences in the type of mutual monitoring information available to team members. We predict and find that team performance is higher when team members can observe only each other's effort than when they can observe both each other's effort and output levels; conversely, team performance is lower when team members can observe only each other's output than when they can observe both each other's effort and output levels. The intuition behind these results is that the type of observable mutual monitoring information creates different degrees of ambiguity regarding what should be considered a fair reward allocation for team members' contributions. Such ambiguity reduces the usefulness of team member communication to the manager for allocating rewards, resulting in lower team performance. Data Availability: Data are available from the authors upon request.

Privacy Aware Incentivization for Participatory Sensing

Participatory sensing is a process whereby mobile device users (or participants) collect environmental data on behalf of a service provider who can then build a service based upon these data. To attract submissions of such data, the service provider will often need to incentivize potential participants by offering a reward. However, for the privacy conscious, the attractiveness of such rewards may be offset by the fact that the receipt of a reward requires users to either divulge their real identity or provide a traceable pseudonym. An incentivization mechanism must therefore facilitate data submission and rewarding in a way that does not violate participant privacy. This paper presents Privacy-Aware Incentivization (PAI), a decentralized peer-to-peer exchange platform that enables the following: (i) Anonymous, unlinkable and protected data submission; (ii) Adaptive, tunable and incentive-compatible reward computation; (iii) Anonymous and untraceable reward allocation and spending. PAI makes rewards allocated to a participant untraceable and unlinkable and incorporates an adaptive and tunable incentivization mechanism which ensures that real-time rewards reflect current environmental conditions and the importance of the data being sought. The allocation of rewards to data submissions only if they are truthful (i.e., incentive compatibility) is also facilitated in a privacy-preserving manner. The approach is evaluated using proofs and experiments.

An Examination of Attributions, Performance Rating and Reward Allocation Patterns: A Comparative Study of China, India, Tanzania and the United States

In this study, using a sample of 191 individuals with significant work and supervisory experience from four countries (China and Tanzania—highly collectivistic, India—moderately collectivistic and the United States—highly individualistic), we examined whether cultural orientations of individualism and collectivism predicted performance ratings, internal attributions made to the poor performing employee and adherence to equity norm in reward allocations. Multiple regression analyses indicated that collectivist Chinese and Tanzanian raters provided more lenient performance ratings to a poor performing employee than individualistic Americans with the Indian raters providing more lenient ratings than Americans but more stringent ratings than Chinese or Tanzanians. Further, American raters made greater internal attributions than Tanzanians or Chinese. Chinese raters made relatively greater internal attributions to the employee than Tanzanians though both cultures are collectivistic cultures. Americans adhered to the equity norm the most and Indians adhered to equity norm but to a lesser extent than Americans but more than Tanzanians and Chinese. Implications are discussed.

Inequality, Institutions and Organizations

The organizations and institutions with which we interact in our everyday lives are heavily implicated in the rising levels of global inequality. We develop understanding of the ways in which a preference in social structures for the free market over other forms of economic organization has made inequality almost inevitable. This has been accompanied by organizational practices such as hiring, promotion and reward allocation, that maintain and enhance societal inequalities. The mutually constitutive relationship between organizations and institutions in the reproduction of inequality are exposed throughout.