We study the effect of user incentives on software security in a network of individual users under costly patching and negative network security externalities. For proprietary software or freeware, we compare four alternative policies to manage network security: (i) consumer self-patching (where...

In recent years, vendor liability for software security vulnerabilities has been the center of an important debate in the software community and a topic gaining government attention in legislative committees and hearings. The importance of this question surrounding vendor security liability is...

We examine the procurement process selection problem of a large industrial buyer who employs reverse auctions for awarding procurement contracts. We contrast two classes of commonly used strategies under multiple sourcing; namely, single-stage reverse auctions, and two-stage processes where...

We model the effects of alternative coordination structures on the performance of a firm that faces uncertain demand in multiple horizontal markets. The firm's coordination structure is jointly determined by its decision-rights structure and by its information structure. We compare the...

We model concept testing in new product development as a search for the most profitable solution to a design problem. When allocating resources, developers must balance the cost of testing multiple designs against the potential profits that may result. We propose extreme-value theory as a...

We study markets for information goods and find that they differ significantly from markets for traditional industrial goods. Markets for information goods in which products are vertically differentiated lack the segmentation inherent in markets for industrial goods. As a result, a monopoly will...

This paper studies alternative price-service mechanisms for a provider that serves customers whose delay cost depends on their service valuations. We propose a generalized delay cost structure that augments the standard additive model with a multiplicative component, capturing the...

This paper considers the consumption behavior of a risk-averse consumer with a preference for immediate consumption who faces an uncertain income stream and plans for a finite or infinite number of periods. The consumer may borrow up to a limit or save, where both saving and borrowing are...

This note integrates the models of Dewan and Mendelson (1998) (DM) and Kyle (1985), extending the DM analysis of time-based competition in financial markets to the case of endogenous liquidity. The results enable us to examine the link between information technology investments, trading...

This paper studies an organizational architecture that I call information-age architecture. I define a measure of organizational IQ and test whether it is related to financial and market success using data from the fast-moving information technology industry. Higher organizational IQ is...