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Tarzan and chain: exploring the ICO jungle and evaluating design archetypes
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2022 | Electronic Markets | Citations: 1
Authors: Bachmann, Nina M.; Drasch, Benedict; Fridgen, Gilbert; Miksch, Michael; Regner, Ferdinand; Schweizer, André; Urbach, Nils

Abstract: The phenomenon of a blockchain use case called initial coin offering (ICO) is dr ... Expand

Abstract: The phenomenon of a blockchain use case called initial coin offering (ICO) is drawing increasing attention as a novel funding mechanism. ICO is a crowdfunding type that utilizes blockchain tokens to allow for truly peer-to-peer investments. Although more than $7bn has been raised globally via ICOs as at 2018, the concept and its implications are not yet entirely understood. The research lags behind in providing in-depth analyses of ICO designs and their long-term success. We address this research gap by developing an ICO taxonomy, applying a cluster analysis to identify prevailing ICO archetypes, and providing an outlook on the token value market performance for individual archetypes. We identify five ICO design archetypes and display their secondary market development from both a short-term and a long-term perspective. We contribute to an in-depth understanding of ICOs and their implications. Further, we offer practitioners tangible design and success indications for future ICOs. Collapse

Semantic filters: auction theory

Topics: Ethereum Bitcoin crowdfunding crowdsourcing cryptocurrency

Methods: cluster analysis qualitative interview chi squared test design methodology hierarchical clustering

Theories: auction theory
The Screening Role of Design Parameters for Service Procurement Auctions in Online Service Outsourcing Platforms
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2022 | Information Systems Research | Citations: 2
Authors: Liang, Chen; Hong, Yili; Chen, Pei-Yu; Shao, Benjamin B. M.

Abstract: This paper provides a novel theoretical angle and robust empirical evidence demo ... Expand

Abstract: This paper provides a novel theoretical angle and robust empirical evidence demonstrating that the auction duration and item description length are two essential auction design parameters that can function as a screening mechanism for bidder quality on online service outsourcing platforms. These outsourcing platforms use buyer-determined reverse auctions to find providers of services (primarily IT services). Using data from a major online outsourcing platform that connects buyers with bidders, we examine the effects of the auction duration and the item description length on both bidder entry (i.e., the number of bids and bidder quality) and contract outcomes (i.e., whether a project is contracted and the buyer’s expected utility from the winning bid) based upon not only project-level, but also bidder-level analyses. Our results show that auctions with longer durations and item descriptions attract more bids (i.e., higher quantity of bidders), and they also attract disproportionately more bidders with lower completion rates (i.e., lower quality of bidders), creating a double whammy of higher evaluation costs and adverse selection for buyers. This, in turn, leads to contracting inefficiency in terms of less successful contracting as well as lower buyer utility. Our research shows strong support for the screening role of the auction duration and the item description length for buyers on online outsourcing platforms for service procurement: by shortening auction durations and item descriptions, buyers can expect higher quality bidders, increase contracting probability, and enhance utility. History: Ravi Bapna, Martin Bichler, Bob Day, and Wolfgang Ketter, Senior Editors; Benjamin Lubin, Associate Editor. This paper has been accepted for the Information Systems Research Special Section on Market Design and Analytics. Supplemental Material: The online appendix is available at https://doi.org/10.1287/isre.2022.1168. Collapse

Semantic filters: auction theory

Topics: outsourcing procurement management website application programming interface database system

Methods: robustness check descriptive statistic sentiment analysis natural language processing computational algorithm

Theories: auction theory lemon market theory
The Welfare Impact of Targeted Advertising Technologies
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2022 | Information Systems Research | Citations: 3
Authors: Marotta, Veronica; Wu, Yue; Zhang, Kaifu; Acquisti, Alessandro

Abstract: We analyze the welfare implications of consumer data sharing, and restrictions t ... Expand

Abstract: We analyze the welfare implications of consumer data sharing, and restrictions to that sharing, in the context of online targeted advertising. Targeting technologies offer firms the ability to reach desired audiences through intermediary platforms. The platforms run auctions in real time to display ads on internet sites, leveraging consumers’ personal information collected online to personalize the ads. The online advertising industry posits that targeted advertising benefits advertising firms (that is, merchants who want to target ads to the desired consumers), consumers who see ads for preferred products, and the intermediary platforms that match consumers with firms. However, the claims that targeted advertising benefits all players involved have not been fully vetted in the literature. We develop an analytical model to analyze the economic and welfare implications of targeting technologies for those three players under alternative consumer information regimes. The regimes differ in the type and amount of consumer data available to the intermediary and to the advertising firms, and reflect the presence or absence of technological or regulatory restrictions to personal information flows. We find evidence of incentive misalignment among the players, as the intermediary prefers to share only a subset of consumer information with firms, whereas advertising firms prefer having complete information about the consumers. As such, a strategic intermediary with the ability to control which information is shared during the auction can have an incentive to use only the information that maximizes its payoff, overlooking the interests of both advertising firms and consumers. The information regimes that maximize consumer welfare vastly differ depending on consumers’ heterogeneity along two dimensions: a horizontal dimension, capturing consumer’s heterogeneity in product preferences; and a vertical dimension, capturing consumers’ heterogeneity in purchase power. Consumers prefer none of their personal information to be used for targeting only in limited circumstances. Otherwise, consumers are either indifferent or prefer only specific types of information to be used for targeting. Collapse

Semantic filters: auction theory

Topics: advertising management IS economics consumer surplus privacy marketing management

Methods: archival research mathematical model theory development

Theories: auction theory
Pay-to-display or Pay-on-Commission: A Behavioral experiment

2021 | Americas Conference on Information Systems | Citations: 0
Authors: Vragov, Roumen; Shang, Di

Abstract: Many digital sales platforms list items for free but require a commission when ... Expand

Abstract: Many digital sales platforms list items for free but require a commission when a sale occurs, while others charge a listing fee based on listing placement or a fee based on the number of visits attracted by the listing. Since sellers might not know in advance which fee schedule to choose or how much to charge for the item for sale, they often experiment with different options until they find the one that brings the highest profit. This process of trial and error is free of losses under commission-based payment because the seller sets the item's price and knows the item's cost, however, if payment is based on the number of exposures or visits(clicks) the process can involve losses. We design a laboratory experiment using humans as subjects to investigate how the possibility of incurring losses affects sellers' search for the maximum profit. Collapse

Semantic filters: auction theory

Topics: virtualization technology digital platform electronic mail artificial intelligence

Methods: experiment laboratory experiment nonparametric test experimental design

Theories: auction theory
Off With Their Headers: Mechanism Choices in Online Display Advertising

2020 | International Conference on Information Systems | Citations: 0
Authors: Balocco, Francesco; Lu, Yixin; Li, Ting

Abstract: The online display advertising market is undergoing major transformations. In th ... Expand

Abstract: The online display advertising market is undergoing major transformations. In this paper, we study the drivers for publishers’ transition from the waterfall model to header bidding and the ad exchanges’ shift from the second-price to the first-price auction through analytical modeling. We show that adopting header bidding is profitable only when advertisers’ valuations are asymmetric. We also show that switching to the first-price sealed bid mechanism is a dominant strategy for Ad Exchanges when publishers adopt header bidding. Our paper contributes to the literature by reconciling different views around the underlying drivers behind the on-going mechanism switches and shedding new lights on the complex interplay of informational and strategic factors in the online display advertising market. Collapse

Semantic filters: auction theory

Topics: banner advertising decision making digital ad exchange online advertising marketing management

Methods: mathematical model design methodology

Theories: auction theory
DON’T SLIP ON THE ICO – A TAXONOMY FOR A BLOCKCHAIN-ENABLED FORM OF CROWDFUNDING

2018 | European Conference On Information Systems | Citations: 0
Authors: Fridgen, Gilbert; Regner, Ferdinand; Schweizer, André; Urbach, Nils

Abstract: Blockchain is rapidly evolving and there is an increasing interest in the techn ... Expand

Abstract: Blockchain is rapidly evolving and there is an increasing interest in the technology in both practice and academia. Recently, a blockchain use case called Initial Coin Offering (ICO) draws a lot of attention. ICO is a novel form of crowdfunding that utilizes blockchain tokens to allow for truly peer-to-peer investments. Although, more than 4.5 billion USD have been invested via ICOs, the phenomenon is poorly understood. Scientific research lacks a structured classification of ICOs to provide further insights into their characteristics. We bridge this gap by developing a taxonomy based on real-world ICO cases, related literature, and expert interviews. Further, we derive and discuss prevailing ICO archetypes. Our findings contribute to theory development in the field of ICOs by enriching the descriptive knowledge, identifying design options, deriving ICO archetypes, and laying the foundation for further research. Additionally, our research provides several benefits for practitioners. Our proposed taxonomy illustrates that there is no one-size-fits-all model of ICOs and might support the decisionmaking process of start-ups, investors and regulators. The proposed ICO archetypes indicate how common ICOs are designed and thus might serves as best practices. Finally, our analysis indicates that ICOs represent a valid alternative to traditional crowdfunding approaches. Collapse

Semantic filters: auction theory

Topics: crowdfunding crowdsourcing cryptocurrency blockchain system development method

Methods: qualitative interview cluster analysis theoretical contribution design methodology personal interview

Theories: auction theory
Targeted Couponing in Online Auctions
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2017 | Information Systems Research | Citations: 0
Authors: Choudhary, Vidyanand; Shivendu, Shivendu

Abstract: To study the role of targeted couponing in auctions, we develop a stylized model ... Expand

Abstract: To study the role of targeted couponing in auctions, we develop a stylized model in which bidders have heterogeneous valuations and participation costs wherein their entry probabilities are endogenous. Couponing impacts the seller’s profit in two ways: (i) impact on bidders’ entry probability including negative externalities for the bidder who does not receive a coupon and (ii) value extraction. We find that targeting a coupon to the low-valuation bidder can be optimal for the firm even if it leads to a reduction in the joint entry probability of the two bidders because of the benefit from value extraction. A novel result is that in the context of auctions it can be optimal for the seller to issue targeted coupons to the high-valuation bidder. We also find that an increase in the bidders’ valuation or reduction in the participation cost can lead to lower profit for the seller. This result is driven by the nonmonotonicity of the joint entry probability of the two bidders and the seller profits being nonmonotone functions of bidders’ valuations and participation costs. Collapse

Semantic filters: auction theory

Topics: online auction competitive advantage privacy

Methods: literature study mathematical model

Theories: auction theory
BISE and the Engineering Sciences
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2016 | Business & Information Systems Engineering | Citations: 0
Authors: Bichler, Martin; Heinzl, Armin; van der Aalst, Wil

Abstract: The development of our journal in the last year has been very encouraging. We h ... Expand

Abstract: The development of our journal in the last year has been very encouraging. We have received over 220 submissions from authors worldwide, and the ISI impact factor 2014 reached 1.7. Overall, the journal and the community are developing favorably and we appreciate the participation and impact of a new and outstanding generation of faculty members, which is important for a prospering community.While the field is growing, the list of research topics is also growing, which makes the core of our discipline harder to embrace and demarcate. For instance, the issue 6 of our journal last year featured two research notes and a discussion on ''grand challenges '' in BISE research (Becker et al. 2015;Barbian and Mertens 2015;Eymann et al. 2015). Apart from a broad collection of research challenges in both research notes, the article by Becker et al. (2015) also summarized challenges for the academic community. Some of the top-ranked challenges concern the identity of the discipline: identifying IS as an academic discipline, rethinking the theoretical foundations of the IS discipline, mastering the methodological breadth/richness, etc.These challenges are not surprising for a field which deals with information technology and information systems. 30 years ago, most BISE research was either rooted in software and data engineering within organizations, or in operations research. The technical developments over the past decades were so rapid that our community adopted many new topics and new methodologies. The range of topics published in our journal today ranges from business process management to electronic markets, social network analysis, and IT governance.On a high level, the design, development, and management of socio-technical systems has been and still is a unifying theme in our journal. But it is also clear that the different topics draw on different theories and technologies. Furthermore, they require different research methods. The reorganization of the BISE editorial board in 2013 along seven departments tried to address the increasing diversity of topics, theories, technologies, and methods used. When we look at the papers published in these departments, they cover a broad range of topics from engineering to scientific theories. This continuum can probably be best characterized as engineering science, as it was described by (Fung and Tong 2001): ''Engineering is quite different from science. Scientists try to understand nature. Engineers try to make things that do not exist in nature. Engineers stress invention. To embody an invention, the engineer must put his idea in concrete terms, and design something that people can use. That something can be a device, a gadget, a material, a method, a computing program, an innovative experiment, a new solution to a problem, or an improvement on what is existing. Collapse

Semantic filters: auction theory

Topics: electronic market IT governance business process management

Methods: operations research social network analysis

Theories: socio technical theory auction theory complexity theory transaction cost economics prospect theory
Competition, Transparency, and Reciprocity: A Comparative Study of Auctions and Negotiations
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2016 | Group Decision and Negotiation | Citations: 0
Authors: Kersten, Gregory E.; Wachowicz, Tomasz; Kersten, Margaret

Abstract: The paper discusses experiments aimed at comparing multi-attribute reverse aucti ... Expand

Abstract: The paper discusses experiments aimed at comparing multi-attribute reverse auctions and multi-bilateral negotiations for procuring goods with multiple attributes. Both exchange mechanisms involve a buyer purchasing from one of several sellers. Two types of negotiations are considered: verifiable and non-verifiable. They differ in the sellers’ knowledge of the current best offer on the table; in verifiable negotiations the best offer is automatically shown to every participant, which makes it similar to auctions. Online auctions and negotiation systems were used to study auction and negotiation processes, and the mechanisms’ efficiency. The results show that buyers did best using auctions, followed by non-verifiable and verifiable negotiations. We also looked into the differences between auctions and negotiations in terms of their duration, sellers’ and buyers’ involvement, and efficiency and conclude that the behavior of buyers and sellers cannot be explained solely on the grounds of traditional economics. It can, however, be explained on the grounds of social exchange theory and behavioral economics. In multi-bilateral negotiations competition and social behavior coexist. When transparency is introduced the social effect becomes stronger, weakening the impact of competition. Collapse

Semantic filters: auction theory

Topics: procurement management economic surplus IS economics decision making

Methods: experiment nonparametric test Kruskal Wallis test field experiment experimental design

Theories: auction theory
Characteristics and Economic Consequences of Jump Bids in Combinatorial Auctions
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2016 | Information Systems Research | Citations: 8
Authors: Sanyal, Pallab

Abstract: Jump bidding, which refers to bidding above the minimum necessary, is a robust b ... Expand

Abstract: Jump bidding, which refers to bidding above the minimum necessary, is a robust behavior that has been observed in a variety of ascending auctions in the field as well as the laboratory. However, the phenomenon has yet to be studied in combinatorial auctions, which are a type of multiobject auction that allows bidders to bid on a set of objects. Such auctions have been found to be beneficial when objects exhibit synergy, e.g., are complementary. In this paper, we explore jump bidding behavior in combinatorial auctions as a function of design choices of the mechanism. In particular, we examine the effects of price revelation schemes on the nature and extent of jump bidding. Furthermore, we study the effects of jump bidding on the economic performance of the auctions. To conduct our study, first, we develop hypotheses using auction theories and behavioral theories of how people use reference prices as anchors, and second, we conduct a laboratory experiment to test our hypotheses and examine bidder behavior. We find that the nature of the prices that the auctioneer chooses to offer as feedback to the bidders can considerably influence their jump bidding behavior, leading to significant differences in auction outcomes. We demonstrate that in combinatorial auctions, in addition to the theories of jump bidding proposed in the literature, bounded rationality of the bidders plays a part in the nature and extent of jump bidding. Our study reveals that in the cognitively challenging package-bidding environment, bidders often pursue computationally frugal but suboptimal heuristics. Our results have important policy implications for mechanism designers. Collapse

Semantic filters: auction theory

Topics: electronic mail decision making

Methods: laboratory experiment experiment statistical hypothesis test paired t-test regression analysis method

Theories: theory of bounded rationality auction theory behavioral theory complexity theory

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Found 53 articles

Tarzan and chain: exploring the ICO jungle and evaluating design archetypes

The Screening Role of Design Parameters for Service Procurement Auctions in Online Service Outsourcing Platforms

The Welfare Impact of Targeted Advertising Technologies

Pay-to-display or Pay-on-Commission: A Behavioral experiment

Off With Their Headers: Mechanism Choices in Online Display Advertising

DON’T SLIP ON THE ICO – A TAXONOMY FOR A BLOCKCHAIN-ENABLED FORM OF CROWDFUNDING

Targeted Couponing in Online Auctions

BISE and the Engineering Sciences

Competition, Transparency, and Reciprocity: A Comparative Study of Auctions and Negotiations

Characteristics and Economic Consequences of Jump Bids in Combinatorial Auctions