Contract design and insurance fraud: an experimental investigation

This paper experimentally examines the impact of contract design on insurance fraud. We test how fraud behavior varies for insurance contracts with full coverage, a straight deductible or claim-dependent premiums (bonus-malus contracts), in a setup where rational and selfish individuals have an incentive to always claim the maximum possible indemnity. We find a substantial impact of contractual arrangements: Deductible contracts lead to a greater extent to claim build-up than full coverage contracts. In contrast, bonus-malus contracts that entail the same net gains from fraud as deductible contracts do not increase claim build-up. Thus, our results indicate that bonus-malus contracts may be superior to deductible contracts for behavioral reasons.     

Understanding and influencing urban residents’ knowledge about wildland management in Austin, Texas

Due to increasing exurban settlement around Austin, Texas and subsequent land use changes, the City of Austin Wildland Division faces competing pressures from residential communities regarding land and wildlife management actions. Current environmental education and outreach efforts in Austin focus on developing environmental literacy about the city’s wildland areas adjacent to exurban settlement as well as their management program. The desired outcome is to promote more positive perceptions and motivate pro-environmental behaviors that are consistent with the city’s wildland program. We conducted a mail survey of 1,000 residents living near the urban wildlands to better understand factors that influence residents’ proficiency in four knowledge domains: karst aquifers, endangered species, rangeland ecology, and the city’s management program. Regression analyses identified positive associations between local newspaper readership and residents’ environmental knowledge of karst aquifer geology, rangelands, and city’s wildland program. Previous engagement in environmentally oriented education programs or organization was positively associated with all four knowledge domains. Some strategies for information dissemination about the wildlands include the use of local newspapers and homeowners association newsletters. Newer, younger residents are the suggested target audience for initiating a proposed environmental education and outreach program. Such programs should incorporate both local environmental organizations and homeowners associations.     

Proactive Screening for Health Needs in United Way's 2-1-1 Information and Referral Service

ABSTRACT

Cancer disproportionately affects the underserved. United Way 2-1-1 is an information and referral system that links underserved populations to community services. This study explores the feasibility of integrating proactive screening and referral to health services into 2-1-1. A cancer risk assessment was administered to callers (n = 297), measuring their need for 6 cancer control services. A subset of respondents was randomized to receive generic or tailored referrals to needed services. Nearly all participants (85%) needed at least one of the services. Those who received tailored referrals were more likely to make appointments. Future research will explore approaches to address and eliminate health disparities through 2-1-1.     

The influence of stimulus ambiguity on category and attitude formation

Existing research on categorical ambiguity has mostly examined how consumers assimilate new products into familiar product categories. Extending these findings, this research investigates whether and under what circumstances consumers either create new mental categories for hybrid products or integrate them into existing categories. Specifically, we propose that this effect is influenced by the degree of product ambiguity and the availability of a new category label. We find that as ambiguity increases, the probability of new category creation augments, but product evaluation deteriorates. However, we also find that a new category label can reduce the effects of ambiguity and can improve product evaluation. Thus, the results fill the existing gap in research on the cognitive integration of hybrid products and shed light on how managers may position these products successfully.     

A fast exact algorithm for the problem of optimum cooperation and the structure of its solutions

Given a graph G=(V,E) with edge weights w _e ∈ℝ, the optimum cooperation problem consists in determining a partition of the graph that maximizes the sum of weights of the edges with nodes in the same class plus the number of the classes of the partition. The problem is also known in the literature as the optimum attack problem in networks. Furthermore, a relevant physics application exists.     

The organization of project evaluation under competition

This article examines the optimal organizational form of project evaluation under competition. The evaluations are carried out by two fallible screening units that sequentially assess projects. Screening can be organized as a hierarchy or a polyarchy. We show that as competitive pressure rises, the polyarchy becomes less attractive. Therefore, different organizational forms might be found in different industries depending on the degree of competition. In addition, we examine endogenous screening rules under competition: For symmetric situations, we show that polyarchies will employ higher decision thresholds compared to hierarchies. Nonetheless, as in the case of exogenous screening rules, the hierarchy becomes more attractive the higher the degree of competition.

The Other‐Race Effect in a Longitudinal Sample of 3‐, 6‐ and 9‐Month‐Old Infants: Evidence of a Training Effect

We investigated the development of the other‐race effect “ORE” in a longitudinal sample of 3‐, 6‐, and 9‐month‐old Caucasian infants. Previous research using cross‐sectional samples has shown an unstable ORE at 3 months, an increase at 6 months and full development at 9 months. In Experiment 1, we tested whether 9‐month‐olds showed the ORE with Caucasian and African faces. As expected, the 9‐month‐olds discriminated faces within their own ethnicity (Caucasian) but not within the unfamiliar ethnicity (African). In months. In Experiment 2, we longitudinally tested infants at 3, 6, and 9 months by presenting either the Caucasian or the African faces used in Experiment 1. In contrast to previous cross‐sectional studies and Experiment 1, we found that infants discriminated between all stimuli. Hence, we did not find the ORE in this longitudinal study even at 9 months. We assume that the infants in our longitudinal study showed no ORE because of previous repetitive exposure to African faces at 3 and 6 months. We argue that only a few presentations of faces from other ethnic categories sufficiently slow the development of the ORE.     

Good item or bad—can latent class analysis tell?: the utility of latent class analysis for the evaluation of survey questions

Summary.  Latent class analysis has been used to model measurement error, to identify flawed survey questions and to estimate mode effects. Using data from a survey of University of Maryland alumni together with alumni records, we evaluate this technique to determine its usefulness for detecting bad questions in the survey context. Two sets of latent class analysis models are applied in this evaluation: latent class models with three indicators and latent class models with two indicators under different assumptions about prevalence and error rates. Our results indicated that the latent class analysis approach produced good qualitative results for the latent class models—the item that the model deemed the worst was the worst according to the true scores. However, the approach yielded weaker quantitative estimates of the error rates for a given item.     

Proactive screening for health needs in United Way's 2-1-1 information and referral service

Cancer disproportionately affects the underserved. United Way 2-1-1 is an information and referral system that links underserved populations to community services. This study explores the feasibility of integrating proactive screening and referral to health services into 2-1-1. A cancer risk assessment was administered to callers (n=297), measuring their need for six cancer control services. A subset of respondents was randomized to receive generic or tailored referrals to needed services. Nearly all participants (85%) needed at least one of the services. Those who received tailored referrals were more likely to make appointments. Future research will explore approaches to address and eliminate health disparities through 2-1-1.     

Who says what to whom: Why messengers and citizen beliefs matter in social policy framing

Issue frames (i.e., the thematic slants that elites use to structure issue debates) have been shown to alter how citizens think about social policy issues. However, support for a social policy issue not only depends on how the issue is framed, but also on the source or “messenger” associated with the frame. For the most part, issue frames have been faceless and research has failed to consider how characteristics of the frame's messenger such as expertise and trustworthiness influence citizens. The present study examines the influence that gun control frames and their messengers have on a variety of dependent variables. The results show that source cues moderate the impact of the frames, even when controlling for other variables. Specifically, credible sources significantly augment the effects of a frame while spokespersons with a perceived bias tend to weaken the frame's arguments and impact. These results point toward a more complex framing theory: public support for social issues depends on how the issue is framed, as well as who presents the message.