An Analysis on the Impact of Choice Overload to Consumer Decision Paralysis

As consumers make purchase decisions, they often encounter a large number of options from which they base their choices. Traditional theories such as the Rational Choice theory imply that the more options involved, the more beneficial for the consumer. However, recent studies suggest otherwise. One such study is that of Choice Overload, a phenomenon in which individuals encounter difficulty when they are presented with too many options. Some studies show that Choice Overload causes paralysis in analysis in different industries. Decision Paralysis is the abandonment of making a decision due to overanalysis. The paper focused on proving if Decision Paralysis would take place when there is Choice Overload by analyzing whether the different antecedents of Choice Overload, namely Decision Task Difficulty, Choice Set Complexity, Preference Uncertainty, Decision Goal, and Asymmetric Information, would be affected by the number of options available. A survey was used to measure the different variables, and the data were analyzed through logistic regression and ordinary least squares regression. The results of this study indicate that Decision Task Difficulty and Asymmetric Information directly impact Choice Overload, which then contributes to the high probability of the occurrence of Decision Paralysis. It is difficult for consumers to choose when more options are offered; thus, abandoning their purchasing decision.

Test of Asymmetric Information in the Nepalese Reinsurance Market

Background: The imperfect information can cause an imbalance of power which may lead to market failure thus collection of information is very essential in today’s business world therefore, the availability of the correct and accurate information is very crucial for making sound economic decisions. Thus, information asymmetry has been a very pertinent issue where economic transaction takes place insurance market is not far behind. As, reinsurance provides huge indirect capital to the insurance industry, providing correct information’s like premium earned, claim by the insurer to the reinsurer’s for fair pricing of reinsurance premium along ensuring top rated reinsurance company remain in Nepalese insurance industry. Objectives: This study aims to examine whether there remains asymmetric information in Nepalese insurance market with reinsurer’s perspective in different portfolios such as fire, marine, motor, engineering and miscellaneous as well as combining all portfolio in aggregate. Methods: The study uses descriptive and causal relation research design. Further, the study uses secondary data of 14 nonlife insurance from 2008/09 to 2018/19 with 168 firm year observations Result: Results of the study revealed that that only in fire, marine and overall portfolios there exists strong asymmetric information. Rest of the portfolio like motor, engineering and miscellaneous there is no evidence of existence of asymmetric information. Conclusion: Existence of asymmetric information is mostly an inevitable part as one party always tries to avoid information to others for the sake of benefit. However, the existence of asymmetric information to a large extent may lead to unhealthy relations between the parties and may bring the cold war distortion of relations. Thus, the finding of the studies is beneficial to the Nepalese nonlife insurers as insurers need to provide correct and accurate information to the reinsures Implication: To cope with asymmetric information in the Nepalese insurance industry, this study provides strong evidence to provide correct and accurate information’s to the reinsurers else top rated reinsurers might withdraw their presence from the Nepalese market which will have adverse effect in the insurance industry.

Asymmetric Information, Transaction Costs, and Farmers Decision To Participate In Tobacco Voor-Oogst Kasturi Contract Farming

Contracts participation between tobacco farmers and traders is still low even benefit of contract is huge. This is related to factors that affect to the contract, demographics, farm characteristic, and other related factors. Contracts that initially became a tool to prevent market failure because it regulates how economic actors act against other, turns out to cause transaction costs as a result of asymmetric information that makes the contract does not function ideally. Therefore, this study attempts to explain asymmetry information during the transfer product and the potential transaction costs incurred using the New Institutional Economy approach. Beside that, this study also attemps to explain factors that underlie farmers decision making partnership, that were analized by using the analyst logistic regression.Respondents in this study were 100 respondents, 50 tobacco contract farmers, and 50 independent farmers from December 2018 through January 2019. The results showed that asymmetric information caused adverse selection and moral hazard, as many as 30% farmers had sold products to other parties and 8% of farmers had used pesticides that prohibited by traders. Contracts that are not ideal due to asymmetric information must be re-enforced by using additional costs called transaction costs which are divided into three typess, namely search and information costs, cost to design, negotiate and conclude and the monitor and contract enforcement costs. Monitoring costs have the potential to absorb the largest portion compared to other types of transaction costs. The greater the asymmetric information generated, the greater the transaction costs incurred. Then the factors that significantly influence the decision making of tobacco farmers to partnership are long time farming experience, land size, risk aversion level, certainty of price and source of capital.

Gender, sexism, and war

We analyze a model of leader gender and crisis bargaining under asymmetric information. There are no essential differences between the sexes in their willingness to use force, but sexist leaders receive a subjective boost for defeating female leaders in war and pay a subjective cost for defeat. We show that this hostile sexism can lead to war for two reasons, first by offering sufficient private benefits to make peace impossible and second by influencing an uninformed leader’s willingness to risk war. We also show that (a) the effect of leader sex on disputes and war depends on the distribution of power, (b) sexist leaders may initiate disputes at less favorable distributions of power than non-sexist leaders, and (c) sexist leaders adopt bargaining strategies that make it difficult for women to cultivate and benefit from reputations for resolve, even in the absence of sex differences in the willingness to use force.

Green Finance in India: Progress and Challenges

This paper deals with the developments in green finance in India as well as globally. Variety of data sources have been used to assess both the extent of public awareness and financing options for green projects. The findings conclude that while there have been improvements in the public awareness and financing options in India, a reduction in asymmetric information through better information management systems and increased coordination amongst stakeholders could pave a way towards a greener and sustainable long term economic growth.

The Reward-Penalty Mechanism in a Closed-Loop Supply Chain with Asymmetric Information of the Third-Party Collector

This paper investigates the reward-penalty mechanism (RPM) implemented by the government in a closed-loop supply chain (CLSC) with asymmetric information. The manufacturer produces and sells products to consumers, while the collection of waste electrical and electronic equipment (WEEE) is delegated to the third-party collector, the one who has private information about the collection effort level. An information screening contract for the manufacturer is put forward to obtain the private information from the third-party collector, which is composed of buy-back price and franchise fee. By utilizing principal-agent theory, two cases are mainly examined including the CLSC without the RPM and the CLSC with the RPM. The results demonstrate that (i) the information screening contract is effective in capturing the collector’s collection effort level, (ii) raising the buy-back price to motivate the third-party collector is confirmed to perform well on enhancing the collection quantity from consumers, (iii) H-type collector collects more WEEEs and earns more profits than L-type collector, and (iv) the RPM improves the collection quantity of the enterprise and reaps more environmental benefits. The numerical results verify the validity of the contract and the feasibility of the RPM.

Stability of Equilibrium Prices in a Dynamic Duopoly Bertrand Game with Asymmetric Information and Cluster Spillovers

Bounded rationality, asymmetric information and spillover effects are widespread in the economic market, and had been studied extensively in oligopoly games, but few references discussed incomplete information in a duopoly market with rationality expectations. Considering the positive externalities brought by the spillover effect between enterprises in a cluster, a duopoly Bertrand game with bounded rationality and asymmetric information is proposed in this paper. In our model, a firm with private information, high or low marginal cost, is introduced. Interestingly, our theoretical analysis reveals that: (1) In a dynamic duopoly Bertrand game with perfect rationality and asymmetric information, the equilibrium price is positively correlated with product substitution rate and the probability of a high marginal cost, while it is negatively correlated with the cluster spillover. (2) In a dynamic duopoly Bertrand game with asymmetric information and adaptive expectation adopted by both firms, the Nash equilibrium prices are always asymptotically stable. (3) In a dynamic duopoly Bertrand game with heterogenous expectation and asymmetric information, where two firms use adaptive expectation and boundedly rational expectation respectively, the Nash equilibrium prices are locally stable under certain conditions. Furthermore, results indicate that, high product substitution rate or large probability of high marginal cost for firm 2 with private information may make the market price unstable, bifurcating or even falling into chaos, while high technology spillover is conducive to stabilize the market by contrast. It is also shown that the chaos can be controlled by a hybrid control strategy with the state variables feedback and parameter variation. Our research has an important theoretical and practical significance to the price competition in oligopoly markets.