Publications

April 2007
Article

Getting Big Too Fast: Strategic Dynamics with Increasing Returns and Bounded Rationality

By: Rebecca M. Henderson, John Sterman, Eric Beinhocker and Lee Newman

Keywords: Strategy

2009
Working Paper

'I read Playboy for the Articles': Justifying and Rationalizing Questionable Preferences

By: Zoe Chance and Michael I. Norton

Keywords: Job Search; Market Participation; Market Transactions; Marketplace Matching; Relationships; Social and Collaborative Networks

1984
Working Paper

Earnings Variability and Variance Bounds Tests for Rationality of Stock Market Prices

By: Robert C. Merton and Terry A. Marsh

Article

The Question of Collective Rationality in Professor Gale's Model of Trade Imbalance

By: Jerry R. Green

Research Summary

Optimal Signaling Policy with Rational and Irrational Agents (with James Burns)

We examine situations in which a single informed agent signals a group of uniformed agents. The uniformed agents must then take an action based on this signal. The motivation for our work comes from real world examples such as terrorist alerts or job safety... View Details

June 1986
Article

Dividend Variability and Variance Bounds Tests for the Rationality of Stock Market Prices

By: Robert C. Merton and Terry A. Marsh

Keywords: Stocks; Markets; Price

2019
Working Paper

Design Rules, Volume 2: How Technology Shapes Organizations: Chapter 9 Organizing to Rationalize

By: Carliss Y. Baldwin

The purpose of this chapter is to explain what the technologies of flow production with stochastic bottlenecks require and reward in organizations. I argue that organizations successfully implementing these technologies are likely to have unified governance and... View Details

Keywords: Information Technology; Organizational Design; Management Teams; Business History

1983
Working Paper

Aggregate Dividend Behavior and Its Implications for Tests of Stock Market Rationality

By: Terry A. Marsh and Robert C. Merton

2022
Working Paper

Overreaction and Diagnostic Expectations in Macroeconomics

By: Pedro Bordalo, Nicola Gennaioli and Andrei Shleifer

We present the case for the centrality of overreaction in expectations for addressing important challenges in finance and macroeconomics. First, non-rational expectations by market participants can be measured and modeled in ways that address some of the key challenges... View Details

Keywords: Overreaction; Rational Expectations; Macroeconomics; Market Participation; Social Psychology

Awards

James Coleman Award for Outstanding Book or Article from the Rationality and Society Section of the American Sociological Association (ASA)

Winner of the 2018 James Coleman Award for Outstanding Book or Article from the Rationality and Society Section of the American Sociological Association (ASA) for Someone To Talk To (Oxford University Press, 2017). View Details

1992
Chapter

Negotiator Rationality and Negotiator Cognition: The Interactive Roles of Prescriptive and Descriptive Research

By: M. H. Bazerman and M. A. Neale

Keywords: Negotiation Style; Cognition and Thinking; Research

August 2012
Article

A Darker Side to Decentralized Banks: Market Power and Credit Rationing in SME Lending

By: Rodrigo Canales and Ramana Nanda

We use loan-level data to study how the organizational structure of banks impacts small business lending. We find that decentralized banks-where branch managers have greater autonomy over lending decisions-give larger loans to small firms and those with "soft... View Details

Keywords: Geographic Location; Customers; Financing and Loans; Credit; Organizational Structure; Banks and Banking; Governance Compliance; Competitive Strategy