Search Results

Executive Compensation: Consequences and Distributions

Sydney Finkelstein, Donald C. Hambrick, and Albert A. Cannella

in Strategic Leadership: Theory and Research on Executives, Top Management Teams, and Boards

The consequences of executive pay are complex and particularly rich in a theoretical and practical sense. This chapter examines one of the most fundamental questions in this regard: Does executive ... More

The consequences of executive pay are complex and particularly rich in a theoretical and practical sense. This chapter examines one of the most fundamental questions in this regard: Does executive pay affect firm performance? The evidence is decidedly mixed, but raises key questions about pay as a motivator, and the different ways in which executive pay can influence strategic and organizational choices as well as firm performance. This chapter also considers the burgeoning literature on behavioral agency theory, which leads naturally to a comparison of the effects of different types of compensation, especially stock options. A significant part of this chapter is dedicated to an analysis of the determinants and consequences of pay differentials among top management teams, another area of great theoretical interest. Studying pay differentials (or pay dispersion), as well as the pattern of compensation in place among the CEO and other top managers, yields fascinating insights that have important consequences for teamwork, perceived fairness of pay, strategic decision making, and firm performance.Less

Obituary

Dennis G Fryback

in A Science of Decision Making: The Legacy of Ward Edwards

This chapter presents an obituary for Ward Edwards. Ward Edwards is considered the father of behavioral decision theory. He authored or co-authored four books and over 200 journal articles.

Behavioral Portfolios: Hope for Riches and Protection from Poverty

Meir Statman

in Pension Design and Structure: New Lessons from Behavioral Finance

This chapter argues that the behavioural portfolio theory offers a good description of investor behaviour and a basis for good policy prescriptions. The theory states that investors view with ... More

This chapter argues that the behavioural portfolio theory offers a good description of investor behaviour and a basis for good policy prescriptions. The theory states that investors view with portfolios not as a whole, but as distinct layers in a pyramid of assets where layers are associated with specific goals, and where attitudes towards risk vary across layers. Unlike the mean-variance theory which offers portfolio descriptions that investors do not follow, the behavioural portfolio theory offers prescription of pyramid portfolios that are closer to reality.Less

Obituary

David J Weiss and James Shanteau

in A Science of Decision Making: The Legacy of Ward Edwards

Following on from the previous two chapters presents an obituary for Ward Edwards. Ward's 1954 paper in the Psychological Bulletin introduced decision making as a research topic for psychologists. He ... More

Following on from the previous two chapters presents an obituary for Ward Edwards. Ward's 1954 paper in the Psychological Bulletin introduced decision making as a research topic for psychologists. He continued to make significant contributions to the field for more than fifty years, contributing some 200 publications to the literature. He died from Parkinson's Disease on February 1, 2005.Less

Game Theory and Human Behavior

Herbert Gintis

in The Bounds of Reason: Game Theory and the Unification of the Behavioral Sciences

Game theory is multiplayer decision theory where the choices of each player affect the payoffs to other players, and the players take this into account in their choice behavior. This chapter ... More

Game theory is multiplayer decision theory where the choices of each player affect the payoffs to other players, and the players take this into account in their choice behavior. This chapter addresses the contribution of game theory to the design of experiments aimed at understanding the behavior of individuals engaged in strategic interaction. This is referred to as behavioral game theory. The chapter goes on to discusses charter virtues, defined as ethically desirable behavioral regularities that individuals value for their own sake, while having the property of facilitating cooperation and enhancing social efficiency. It presents two studies that illustrate the situational nature of preferences and the desire to conform to social norms. It then deals with the dark side of altruistic cooperation and norms of cooperation.Less

Behavioural theory: understanding the key influences on human behaviour

Clive Blair-Stevens, Lucy Reynolds, and Alex Christopoulos

in Social Marketing and Public Health: Theory and practice

Having an understanding of the use of theory (particularly behavioural theory) can strengthen and enhance the development and delivery of social marketing interventions and, therefore, can ultimately ... More

Having an understanding of the use of theory (particularly behavioural theory) can strengthen and enhance the development and delivery of social marketing interventions and, therefore, can ultimately improve and strengthen their potential impact and effectiveness. However, all too often, people say that they find literature explaining different theoretical perspectives dense, and hard to read and understand. This chapter seeks to help people appreciate how theory can be a practical aid in their work. It provides an understanding of how behavioural theory can practically support effective intervention development and delivery; discusses the different types of influence on human behaviour; sets out the strengths and limitations of different disciplinary contributions to understanding what influences behaviour; and stresses the value of bringing people from different disciplines together to help examine and consider key behavioural challenges.Less

Bounded Rationality and Elections

Jonathan Bendor, Daniel Diermeier, David A. Siegel, and Michael M. Ting

in A Behavioral Theory of Elections

This book discusses a behavioral theory of elections based on bounded rationality. As a research program, bounded rationality contains a set of alternative formulations, rather than a single theory ... More

This book discusses a behavioral theory of elections based on bounded rationality. As a research program, bounded rationality contains a set of alternative formulations, rather than a single theory or model. The issues raised by the bounded rationality program—the impact of cognitive constraints on behavior—are as pertinent to politics as they are to markets, perhaps even more so. This is evident in the subfield of elections. This chapter considers two major topics that are central to a behavioral theory of elections: framing and heuristics. It also explores aspiration-based adaptive rules (ABARs), the relation between the research programs of bounded rationality and rational choice, voter turnout, and the cognitive capacities of voters and politicians. Finally, it provides an overview of the topics tackled in the book.Less

Theoretical contributions to understanding music performance anxiety

Dianna T. Kenny

in The Psychology of Music Performance Anxiety

This chapter explores the range of theoretical approaches that have been established in other areas of psychological functioning and which may have something to offer to advance our understanding of ... More

This chapter explores the range of theoretical approaches that have been established in other areas of psychological functioning and which may have something to offer to advance our understanding of music performance anxiety and its treatment. These include psychoanalytic/psychodynamic theories, attachment and relational theories of anxiety, behavioural theories, cognitive theories, emotion-based theories, psychophysiological and neurochemical theories, theories of performance, and theories of music performance anxiety.Less

Credit Cards

Bar-Gill Oren

in Seduction by Contract: Law, Economics, and Psychology in Consumer Markets

This chapter focuses on the credit card contract. It identifies two features common to most credit card contracts — complexity and deferred costs. It presents a behavioural-economics theory of credit ... More

This chapter focuses on the credit card contract. It identifies two features common to most credit card contracts — complexity and deferred costs. It presents a behavioural-economics theory of credit card contracts, and then argues that complexity and deferred costs represent a strategic response by sophisticated issuers to imperfectly rational cardholders. There is a behaviour market failure in the credit card industry that reduces efficiency and hurts cardholders. Regulatory intervention can help minimize the adverse effects of this market failure.Less

Behavioral Parent Training with Oppositional Defiant Disorder

Jacqueline Corcoran

in Clinical Applications of Evidence-Based Family Interventions

This chapter applies the use of behavioral parent training for the problem of Oppositional Defiant Disorder in a child. The behavioral theory basis of parent training is discussed, followed by ... More

This chapter applies the use of behavioral parent training for the problem of Oppositional Defiant Disorder in a child. The behavioral theory basis of parent training is discussed, followed by empirical support for this approach. Techniques covered include: behaviorally specifying goals for change and tracking target behaviors; positively reinforcing prosocial conduct through the use of attention, praise, point systems, and other reinforcers; and employing alternative discipline methods, such as differential attention, natural and logical consequences, time out from reinforcement, response cost, and the removal of privileges. Methods of behavioral therapy will also be covered, including lecture, discussion, modeling, and role-playing.Less

Theoretical Paradigms for Understanding the Psychology of Fear

Samuel Justin Sinclair and Daniel Antonius

in The Psychology of Terrorism Fears

Moving away from more conventional models of psychopathology, this chapter presents a variety of theoretical frameworks for understanding the psychology of terrorism fears. Terror management theory ... More

Moving away from more conventional models of psychopathology, this chapter presents a variety of theoretical frameworks for understanding the psychology of terrorism fears. Terror management theory and evolutionary theory are presented to illustrate the complex social and existential dynamics that underlie fear, and those factors that ameliorate these fears (e.g., seeking connection with people and culture). Fear is presented as both adaptive (e.g., ensuring the survival of a species) and potentially maladaptive (e.g., becoming so flooded with terror that one’s life is negatively affected as a result). On an individual level, cognitive-behavioral and relative risk appraisal theories are then discussed to emphasize the micro-processes that people engage in when evaluating threat in the environment, and specifically how certain cognitive schemas predispose people to varying degrees of fear. These four theories are then integrated as a means of describing terrorism fears as a dynamic process.Less

Conclusions Bounded Rationality and Elections

Jonathan Bendor, Daniel Diermeier, David A. Siegel, and Michael M. Ting

in A Behavioral Theory of Elections

This chapter summarizes the book’s major findings regarding party location, turnout, voter choice, and voter participation. First, the simple party competition model suggests that in unidimensional ... More

This chapter summarizes the book’s major findings regarding party location, turnout, voter choice, and voter participation. First, the simple party competition model suggests that in unidimensional policy spaces, satisficing by winners plus search by losers produces a string of governmental policies that converges to the median voter’s ideal point when citizens always vote for the party that will better serve their interests. Second, turnout responds in intuitive ways to changes in parameter values. Average participation is higher the further apart the parties, in both two-component models with fixed platforms and in the simple turnout model. Third, voters learn to support parties that better serve their interests. Fourth, voter coordination is usually successful: the Condorcet loser is almost never selected. The behavioral theory of elections based on bounded rationality is formulated in the languages of dynamic systems and stochastic processes.Less

Obituary

Lawrence D Phillips

in A Science of Decision Making: The Legacy of Ward Edwards

Following on from the last chapter this chapter presents an obituary for Ward Edwards. His numerous professional achievements are detailed. Much of the information provided was from the author's ... More

Following on from the last chapter this chapter presents an obituary for Ward Edwards. His numerous professional achievements are detailed. Much of the information provided was from the author's videoed conversations with Ward Edwards over the two days following the 1st, and last, Bayesian Conference on 13-14 February 2003.Less

Behavioral Theory and Corporal Punishment

Scott W. Powers and Robert E. Larzelere

in Corporal Punishment of Children in Theoretical Perspective

This chapter discusses the topic of corporal punishment of children from a behavioral-theory and behavior-therapy perspective. Basic principles of learning theory are presented, followed by ... More

This chapter discusses the topic of corporal punishment of children from a behavioral-theory and behavior-therapy perspective. Basic principles of learning theory are presented, followed by information based upon the work of behavioral clinicians. The goal is to address the question of how we can better understand the causes and consequences of corporal punishment and utilize this knowledge in an objective way to assist families in the important process of raising their children to be secure, adaptive, and productive people. A discussion of how behavioral research and its application can inform us about the causes of corporal punishment and its effects on children, families, and society is of great utility.Less

Failure of Normative Contract Theory

Peter A. Alces

in A Theory of Contract Law: Empirical Insights and Moral Psychology

A viable unifying theory of contract would be useful as a heuristic device: It would provide intellectual leverage and could determine both how doctrine should be applied and predict how it will be ... More

A viable unifying theory of contract would be useful as a heuristic device: It would provide intellectual leverage and could determine both how doctrine should be applied and predict how it will be applied. But contract does not hue to a single normative theory; it is, instead, dependent on an accommodation of deontic and consequentialist inclinations. The nature of contract is revealed through understanding the reason why unitary theories have been inadequate. This chapter examines the theoretical inquiry and suggests why extant theory fails to account for all of contract. The actions of human agents may best be explained as the product of a combination of consequentialist and non-consequentialist impulses. It may be possible to understand contract doctrine as a means to facilitate an empirical morality.Less

. Technology Transfer: A Behavioral Framework

Michael Brian Schiffer

in Draw the Lightning Down: Benjamin Franklin and Electrical Technology in the Age of Enlightenment

This chapter describes the technology-transfer framework that helped in investigating the differentiation of electrical technology in the Enlightenment. It draws upon the material on behavioral ... More

This chapter describes the technology-transfer framework that helped in investigating the differentiation of electrical technology in the Enlightenment. It draws upon the material on behavioral theory from archaeology. The technology-transfer framework should be general enough to accommodate any groups that acquire and modify the technology of interest. Regardless of the nature of the communities (or technologies) involved, technology transfer can be modeled as a six-phase process. These phases, namely information transfer, experimentation, redesign, replication, acquisition, and use, are discussed in detail. It is suggested that the most important use of the framework is to establish the behavioral parameters on which to fashion contextualized narratives of technological differentiation. It is concluded that electrical technology was differentiated by literate and clever individuals of diverse socioeconomic, religious, and national backgrounds who took part in varied activities—scientific, political, recreational, or medical.Less

Cultural Regulation, Self-regulation, and Sexuality: A Psycho-Cultural Model of HIV Risk in Latino Gay Men

Richard Parker, Regina Maria Barbosa, and Peter Aggleton

in Framing the Sexual Subject: The Politics of Gender, Sexuality, and Power

This chapter discusses interrelated social and cultural factors that impact the lives of Latino gay men, thus making it impossible for many to reduce risk in their sexual practice. It provides a ... More

This chapter discusses interrelated social and cultural factors that impact the lives of Latino gay men, thus making it impossible for many to reduce risk in their sexual practice. It provides a powerful critique of the limitations of dominant cognitive-behavioral theories of behavior change in response to HIV/AIDS. It studies the urgent need for culturally appropriate, community based, intervention strategies capable of enabling Latino gay men to change intentions into action by reinventing sexual scripts free from the damaging effects of intertwined oppressions.Less

Applying Behavioral and Social Science Theory to HIV Prevention: The Need for Structural-Level Approaches

R. A Crosby and R. J DiClemente

in Structural Interventions for HIV Prevention: Optimizing Strategies for Reducing New Infections and Improving Care

Set in the context of high-impact prevention, this chapter provides a brief historical account of how theory application to HIV prevention has evolved from individual-level models to structural-level ... More

Set in the context of high-impact prevention, this chapter provides a brief historical account of how theory application to HIV prevention has evolved from individual-level models to structural-level approaches. The chapter describes the value and limitations of applying behavioral science and social science theories to the pandemic and describes several models and theory-based approaches. It then proceeds to identify emerging, structural-level approaches to achieving population-level HIV prevention in developing and developed countries. The chapter distinguishes structural-level interventions from multilevel interventions, and it describes strengths and weaknesses of structural-level approaches to achieving high-impact prevention. In so doing, several critical principles of structural-level approaches are identified.Less

Game Theory and the Law: Incomplete Knowledge about the Knowledge of Other Players

Marlies Ahlert

in Theories of Choice: The Social Science and the Law of Decision Making

Classical game theory analyses strategic interactions under extreme idealisations. It assumes cognitively unconstrained players with common knowledge concerning game forms, preferences, and ... More

Classical game theory analyses strategic interactions under extreme idealisations. It assumes cognitively unconstrained players with common knowledge concerning game forms, preferences, and rationality. Such ideal theory is highly relevant for human self-understanding as a rational being or what Selten called ‘rationology’. Yet, ideal theory is highly irrelevant for real actors who are in Selten’s sense boundedly rational. Starting from essential features of real bargaining problems, elements of Selten’s ‘micro-psychological’ and Raiffa’s ‘telescopic’ behavioural bargaining theory are introduced. From this, an outline of a workable rationality approach to bargaining emerges. It suggests relying on telescopic elements from Raiffa’s model to provide general outcome orientation and on insights from Selten’s aspiration adaptation model of individual decision making to develop process-sensitive action advice. A bird’s eye view of a prominent recent case of ‘bargaining in the shadow of the courts’ shows a surprisingly good fit of outcomes with the implications of Raiffa’s telescopic approach while remaining compatible with a Seltenian process. Though due to a lack of specific information because the micro-foundations for the telescopic theory cannot be provided, it is at least clear how further case studies and experiments might be put to work here.Less