A Model of Trading in the Art Market


American Economic Review

March 2018, vol. 108, n°3, pp.744-774

Departments: Finance, GREGHEC (CNRS)

Keywords: art; auctions; endogenous trading; price indexes; private values; returns

We present an infinite-horizon model of endogenous trading in the art auction market. Agents make purchase and sale decisions based on the relative magnitude of their private use value in each period. Our model generates endogenous cross-sectional and time-series patterns in investment outcomes. Average returns and buy-in probabilities are negatively correlated with the time between purchase and resale (attempt). Idiosyncratic risk does not converge to zero as the holding period shrinks. Prices and auction volume increase during expansions. Our model finds empirical support in auction data and has implications for selection biases in observed prices and transaction-based price indexes

Belief-free price formation


Journal of Financial Economics

February 2018, vol. 127, pp.342-365

Departments: Finance, GREGHEC (CNRS), Economics & Decision Sciences

Keywords: Financial market microstructure, Informed dealers, Price volatility, Belief-free equilibria

We analyze security price formation in a dynamic setting in which long-lived dealers re- peatedly compete for the opportunity to trade with short-lived retail traders. We charac- terize equilibria in which dealers’ pricing strategies are optimal irrespective of the private information that each dealer may possess. Thus, our model’s predictions are robust to dif- ferent specifications of the dealers’ information structure. These equilibria reconcile, in a unified and parsimonious framework, price dynamics that are reminiscent of well-known stylized facts: excess price volatility, price to trading flow correlation, stochastic volatility and inventory-related trading

Collaborative Prototyping of Alternative Designs Under a Target Costing Scheme


Production and Operations Management

March 2018, vol. 27, n°3, pp.496–515

Keywords: Collaborative prototyping, Parallel and sequential testing, Supplier involvement, Target costing

Prototyping allows firms to evaluate the technical feasibility of alternative product designs and to better estimate their costs. We study a collaborative prototyping scenario in which a manufacturer involves a supplier in the prototyping process by letting the supplier make detailed design choices for critical components and provide prototypes for testing. While the supplier can obtain private information about the costs, the manufacturer uses target costing to gain control over the design choice. We show that involving the supplier in the prototyping process has an important influence on the manufacturer's optimal decisions. The collaboration results in information asymmetry, which makes parallel prototyping less attractive and potentially reverses the optimal testing sequence under sequential prototyping: It may be optimal to test designs in increasing order of attractiveness to avoid that the supplier does not release technically and economically feasible prototypes for strategic reasons. We also find that the classical target costing approaches (cost- and market-based) need to be adjusted in the presence of alternative designs: Due to the strategic behavior of suppliers, it is not always optimal to provide identical target costs for designs with similar cost and performance estimates, nor to provide different target costs for dissimilar designs. Furthermore, the timing is important: While committing upfront to carefully chosen target costs reduces the supplier's strategic behavior, in some circumstances, the manufacturer can take advantage of this behavior by remaining flexible and specifying the second prototype's target costs later

Construction of Relations with Distant Suppliers on the Cognitive and Relational Dimensions to Co-Explore Discontinuous Innovations / Construction des relations avec des fournisseurs distants sur les plans cognitifs et relationnels pour co-explorer des in


Innovations, Revue d’économie et de management de l'innovation

2018, vol. 1, n°55, pp.61-87

Departments: GREGHEC (CNRS)

Keywords: innovation discontinue, implication des fournisseurs, fournisseurs distants, open innovation, exploration, organisation ambidextre / discontinuous innovation, suppliers contribution, distant suppliers, open innovation, exploration, organizational ambidextry

Co-exploring concepts with distant suppliers on the cognitive and relational dimensions favors the identification of discontinuous innovation. However, few researches address the establishment of such relations. Based on a longitudinal study of a firm that has developed relations with distant suppliers and succeeded in co-exploring discontinuous innovation, we inductively highlight the characteristics of the process and of the organizational design that enabled the building of these relations. We point out the transparency of the co-exploration process that enables a progressive mutual commitment. The establishment of the relations is supported by a specific player with access to the top management and technical specialists, giving him a global vision of the questions to be tackled. By developing these relations simultaneously with the ones involving long term partners, this player is therefore an enabler of the organizational ambidexterity of the firm

Investigating the drivers for social commerce in social media platforms: Importance of trust, social support and the platform perceived usage


Journal of Retailing and Consumer Services

March 2018, vol. 41, pp.11-19

Keywords: Social commerce; S-vendors; Trust; Social media; Social support; UTAUT2 Model

This study sheds light on the drivers of social commerce in social media platforms. First, it explores the perceived characteristics of the social commerce vendor and investigates their influence on users’ trust. Second, it tests the influence of trust and the platform perceived usage (using the Unified Technology Acceptance and Use of Technology Model 2) on social commerce intent. Data from a survey of Instagram users, within the Golf Corporation Council countries, were collected online. Results show that reputation and price advantage have the strongest influence on trust, although those effects are weakened by habits. Contrary to expectations, social interactions with the social commerce vendor decrease trust. Similarly, product differentiation reduces trust. Nevertheless, this effect is negatively moderated by social support. Perceived ease of use of the platform, facilitating conditions, hedonic motives and habits increase social commerce intent. The findings of this research offer some insights on the mechanisms through which the s-vendor characteristics influence social commerce intent on social media platforms. Findings help businesses better understand the social commerce landscape and improve their marketing strategies