Using a proprietary dataset provided by a major manufacturer of aircraft engines, we empirically investigate how product reliability is impacted by use of two different types of after-sales maintenance support contracts: time and material contracts (T&MC) and performance-based contracts (PBC)....

During development of an innovative product there is often considerable uncertainty about component production cost, and it is of interest for both the manufacturer and the supplier to engage in a collaborative effort to reduce this uncertainty and lower the expected cost. Despite the obvious...

We study production networks of automotive assembly plants to shed new light on the impact of flexibility on plant productivity. We observe that the contemporary manufacturing networks of automotive assembly plants of three US companies (Chrysler, Ford and General Motors) have become less...

We examine a large operational data set in a casual restaurant setting to study how coworkers' sales ability level affects other workers' sales performance. We find that waiters react non-linearly to their coworkers' ability. In particular, when coworkers' overall sales ability is low,...

Firms commonly undertake philanthropic campaigns as a means of attracting and retaining customers. Such campaigns often take the form of charity-linked promotions, whereby a firm donates a specific amount to a charitable cause when a customer takes up the promotion through a related purchase. We...

To analyze incentives for investing in the capacity to generate renewable electricity, we model the trade-off between renewable (e.g. wind) and nonrenewable (e.g. natural gas) technology. Renewable technology has a higher investment cost and yields only an intermittent supply of electricity;...

We study price competition in markets with a large number (in magnitude of hundreds or thousands) of potential competitors. We address two methodological challenges: simultaneity bias and high dimensionality. Simultaneity bias arises from joint determination of prices in competitive markets. We...

The authors study threshold discounting, or the practice of offering a discounted-price service if at least a pre-specified number of customers signal interest in it, as pioneered by Groupon. We model a capacity-constrained firm, a random-sized population of strategic customers, a desirable hot...

We empirically examine the impact of expanded product variety on demand concentration using large data sets from the movie rental industry as our test bed. We find that product variety is likely to increase demand concentration, which goes against the “Long Tail effect” theory predicting...