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Although the prices of cryptocurrencies remained volatile for the past decade, the factors that impact the price dynamics of the new type of investment instrument have not been fully identified yet. In this study, we recognize the dual nature of cryptocurrencies, that is, being a software program and a financial instrument, and examine the impact of software advancement on the price dynamics of cryptocurrencies. The open-source software (OSS) platform functionality enables social behaviors that we use as signals. Using data from the largest OSS platform, we establish the connection between open-source activities and the price movement of cryptocurrency. In particular, as project popularity (forks and watches) and users' feedback (issues) increase, the market price increases by 4.3 percent, 2.4 percent, and 4.4 percent per annum, respectively. On the contrary, the number of code corrections (pull requests) is negatively related to prices leading to a 5 percent annual price decrease. Our results suggest that OSS contributions create a perfect selection mechanism, where higher quality projects receive more developers' attention and user feedback, whereas lower quality projects do not, thus creating the separating equilibrium. [ABSTRACT FROM AUTHOR]

This paper investigates the ramifications of information feed integration on user engagements and contributions in online content-sharing platforms by exploiting a natural experiment occurred in a leading knowledge-sharing platform that integrated informal social posts with professional knowledge content in one feed. Our results show that the juxtaposition of incongruous types of content increased mindset switching and cognitive strain, thus hurting user engagements. We also reveal a novel crowding-out effect, viz., the integration heightened concerns that posting informal social posts would dilute the contributor's professional image, thus inhibiting user contributions. Our findings hold important practical implications for all platforms that host (or are considering hosting) diverse types of user-generated content (UGC). Additional content curation tools can potentially enhance user engagement and retention, but their effectiveness hinges on a foundational and crucial element—the presentation format of heterogeneous content types. Essentially, the value of curating informal social posts in a knowledge-sharing platform would diminish when those content intrudes upon and conflict with the professional domain. This insight underscores that any UGC platforms, when adopting a diversity-oriented strategy, should pay close attention to heterogeneity between different content types for the purpose of optimizing user experiences and promoting user contributions. Many online communities that rely on effortful, voluntary content contributions offer additional content curation tools to facilitate social interactions and encourage user contributions. Any platform that offers two or more heterogeneous content types (e.g., expert knowledge and social posts) faces a choice about the presentation format: whether to display the content types separately or in an integrated information feed. We leverage a natural experiment on Zhihu, a Q&A platform that offers a social-interaction-oriented functionality called Ideas. Zhihu initially presented answers (expert knowledge content) and ideas (social posts) in two different information feeds, but the platform integrated ideas into the same information feed as answers in June 2019. We find that information feed integration significantly decreased user engagement with and contribution of both ideas and answers. We hypothesize that users decreased their engagement because the juxtaposition of incongruous types of content increased mindset switching and cognitive strain. This hypothesis is supported by an additional laboratory experiment. We also present evidence showing that contributions decreased both because of the decrease in engagement (weaker social recognition incentives) and because integration heightened concerns that posting ideas would dilute the contributor's professional image. Our findings have important theoretical and practical implications for any platform that hosts heterogeneous content. History: Xiaoquan (Michael) Zhang served as the senior editor and Yili (Kevin) Hong served as associate editor for this article. Funding: Z. Cao acknowledges this research was funded by National Natural Science Foundation of China [Grants 72201238, 72192823]. G. Li acknowledges this research was funded by National Natural Science Foundation of China [Grant 72102047] and Shanghai Pujiang Program [Grant 21PJC006]. Supplemental Material: The e-companion is available at https://doi.org/10.1287/isre.2022.0043. [ABSTRACT FROM AUTHOR]

Theoretical and empirical evidence point to the ability of political leaders to manipulate economic policies and leverage local firms to elevate their political careers. Despite this, there is limited understanding of how these career incentives impact the operational dynamics of the firms involved. This empirical study delves into this gap, revealing that city leaders with fewer promotional incentives are more inclined to mobilize state-owned enterprises (SOEs) within their jurisdiction to pursue sustainable development, as indicated by heightened corporate operational efficiency. Our analysis further indicates that the career prospects of city leaders significantly influence the operational efficiency of SOEs by driving a shift in focus from rapid growth to sustainable development and firms' adoption of disruptive technologies. We posit that this increase in operational efficiency not only benefits the SOEs but also generates unique value for stakeholders, resulting in elevated market capitalization and reduced stock price crash risk. Our findings carry direct relevance to the ongoing discourse on political incentives and contribute to operations management research, shedding light on the intricate ways in which the political environment can impact the operational performance of firms. [ABSTRACT FROM AUTHOR]

The medical insurance payment system (MIPS) is a key mechanism to ensure the public's access to medical services. In a game‐theoretic model, we examine the impact of two MIPSs, fee‐for‐service (FFS) and diagnosis‐related groups (DRG), on patient choices, provider behavior, and out‐of‐pocket rate. We find that neither FFS nor DRG can dominate the other in all three aspects: social welfare, provider profit, and total patient surplus. In particular, under DRG, the out‐of‐pocket rate for patients is lower, and the total patient surplus is higher than that under FFS. However, patients with lower illness severity tend to not participate in DRG, while FFS can make all patients participate in the program. Furthermore, when the marginal cost of medical services is high, the profit of the provider and social welfare under DRG is higher than those under FFS, otherwise lower. After interviewing hospital leaders, we further investigate two extended (pilot) payment systems: DRG with two price groups, and the hybrid model incorporating both FFS and DRG. We find that both models contribute to improving provider behavior, making more patients choose the provider, but are still not perfect payment systems due to lower provider profit or social welfare. Our findings offer important insights for policymakers regarding implementing medical insurance reform in practice. [ABSTRACT FROM AUTHOR]

Abstract. Question-and-answer (Q&A) forums are gaining popularity as a user-engagement tool to drive traffic on multiservice portals. In a platform market model, demand-side users seek answers from supply-side users because [...]

Abstract. The unprecedented growth of cellular traffic driven by the use of smartphones for web surfing, video streaming, and cloud-based services poses bandwidth challenges for cellular service providers. To manage [...]

On e-commerce platforms, consumers rely heavily on online reviews, sales volume, and social media discussions to infer product quality. As a result, the past decade has witnessed an explosive growth of seller-initiated misrepresentation of quality through fake reviews, fake sales, and fake posts. We develop an analytical model to investigate sellers' competition in quality misrepresentation in agency pricing and the platform's policies. The platform can discourage sellers' quality misrepresentations by increasing the cost of misrepresentation or implementing a more lenient product return policy. We find that while a stricter anti-misrepresentation policy deters the misrepresentation of the high-quality seller, such a strategy may unintendedly incentivize the low-quality seller to misrepresent the quality more. Furthermore, increasing return leniency deters low-quality seller's misrepresentation in a wider range of market conditions than increasing the misrepresentation cost. We show sellers' online quality misrepresentation behaviors in a competitive setting, and our results have practical implications for platform policies. [ABSTRACT FROM AUTHOR]

Innovation and competition are two major pillars in the information technology (IT) industry. In this paper, we examine the causal relationship between product market competition and innovations in the IT industry. We measure the innovations from both the quantity (number of patents) and the quality (number of non-self citations) perspectives. Based on the Herfindahl-Hirschman Index and natural experiments, we find robust evidence that the competition has a positive effect on the innovations of the IT industry. Specifically, after the exogenous shock to the market (import tariff cuts and thus increased industry competition), the number of patents per IT firm increases by 27.3 percent, and the number of non-self citations per IT firm increases by 38.2 percent on average. The effects are more pronounced in the more competitive sectors. Our study highlights the importance of the competition in the IT industry and suggests that the positive effect of competition on innovation in the IT context is likely to be driven by the parallel search effect. Our findings contribute to the recent policy debate and suggest that reducing import barriers may bring important welfare gains through innovations in the IT industry. [ABSTRACT FROM AUTHOR]

Reputation systems have been an important component for improvement of online markets' efficiency by reducing uncertainty about the quality of the sellers. Most, if not all, reputation systems examined in the extant literature reflect the sellers' long-term accumulative reputation, which has several drawbacks that impede accomplishing the intended goals of the reputation systems. Taobao.com, the largest consumer-to-consumer online market in China, implemented the Gold Medal Seller (GMS) program as a concurrent reputation mechanism to enhance its existing long-term accumulative reputation system. The GMS program presents a backdrop that allows us to address several intriguing research issues not empirically examined in prior literature. By adopting multiple causal identification strategies, we find that earning a reputation badge has a positive impact on sales, and losing a reputation badge has a negative impact on sales. More importantly, the signaling value of obtaining/losing a reputation badge is asymmetric: The magnitude of the effect of losing a reputation badge is four times larger than that of earning a badge. Moreover, consecutively keeping a reputation badge or earning it multiple times is a stronger signal for seller quality and has a larger positive impact on sales, which suggests that the marginal value of reputation badges increases. Our findings offer a new and deeper understanding of the reputation system mechanism design. [ABSTRACT FROM AUTHOR]

We discuss the economic impacts of the interplay between vertical integration and zero-rating for digital content. To this end, we develop a game-theoretic model that involves an Internet Service Provider (ISP), two competing content providers (CPs)—one an ad-supported CP, the other ad-free—and consumers. While previous studies have separately examined vertical integration and zero-rated content, none to our knowledge has explored the simultaneous interaction of both phenomena, which became apparent after the historic merger of AT&T and Time Warner. This vertical integration of an ISP and a CP has sparked an intense debate among policymakers and practitioners alike over the economic implications and consequent business practices (e.g., zero-rated content). The results of our analysis show that an ISP can generate higher profits after the merger with zero-rated content. Surprisingly, we find that the consumer valuation of the ad-free content significantly affects how the ISP will decide to maximize its profit. We extend our model to additionally consider the CPs' partial sponsorship of their consumers' data usage as well as the ISP's different pricing schemes for its consumers and the CPs. Our analysis, which illustrates the various arrangements between vertical integration and zero-rated content, and our findings on consumer surplus and social welfare should be helpful to policymakers as well as to the ISPs, CPs, and consumers of digital content. [ABSTRACT FROM AUTHOR]

The rise of social media platforms has created new opportunities for successful customer relationship management (CRM) activities. Compared with traditional CRM, social media–based CRM enables brands to easily and directly communicate with their customers, which can strengthen customer relationships. The public nature of social media offers an innovative way for brands to engage and manage their customer relationships, increasing brand awareness and enabling easy access to prospective customers. However, public customer engagement on social media does not come without risk. For example, negative word of mouth on social media stemming from poor customer engagement or a brand response can disseminate and reach a large audience. Despite the popularity of social media platforms as customer relationship channels, it is still unclear how a brand crisis can change a brand's social CRM efforts. Leveraging a natural experiment setting, we investigate the impact of the United Airlines crisis on three dimensions of social CRM efforts: informativeness, timeliness, and attentiveness. Contrary to traditional CRM efforts and recommendations, we find that the brand crisis increases informativeness efforts but reduces timeliness and attentiveness efforts. In this study, we investigate the effect of a brand crisis on the customer relationship management (CRM) efforts of brands on social media. Despite the opportunities social media offers to brands to connect and engage with customers, it is still unclear how a brand crisis can change a brand's social CRM efforts. Social media platforms can amplify the negative consequences of a brand crisis. However, the unique and public nature of social media platforms can offer new means for brands to handle a brand crisis and publicly manage their customer relationships. Compared with traditional CRM, social media enables brands to communicate with their customers publicly, which can strengthen their relationships with customers and maintain higher levels of customer engagement. Leveraging a natural experiment setting, we investigate the impact of the United Airlines crisis on three dimensions of social CRM efforts: informativeness, timeliness, and attentiveness. Contrary to traditional CRM efforts and recommendations, we find that the brand crisis increases informativeness efforts but reduces timeliness and attentiveness efforts. History: Yong Tan, Senior Editor; Beibei Li, Associate Editor. Supplemental Material: The online appendix is available at https://doi.org/10.1287/isre.2022.1159. [ABSTRACT FROM AUTHOR]

Online healthcare portals have become prevalent worldwide in recent years. One common form of healthcare portal is the online consultation website, which provides a bridge between patients and doctors and reduces patients' time and cost when seeking healthcare services. Another form is the healthcare service appointment website, which facilitates offline visits for patients. Though nominally separate, the behaviors of the users (including patients and doctors) on these two types of websites could be related to each other. In particular, how does opening online consultation services impact the offline appointments of doctors? Although this is an important question for healthcare portals, doctors, and policy makers, it has not been rigorously examined in the literature. We examine the overall impact of opening online consultation services on offline appointments and show that the number of offline appointments for doctors increases after opening online consultation services. Given that online consultation is a new but important way to connect patients and doctors, our findings provide useful implications for all the stakeholders—doctors, patients, hospitals, and policy makers—regarding how to integrate online and offline channels in the healthcare context. Online healthcare portals have become prevalent worldwide in recent years. One common form of a healthcare portal is the online consultation website, which provides a bridge between patients and doctors and reduces patients' time and cost when seeking healthcare services. Another form is the healthcare service appointment website, which facilitates offline visits for patients. Although nominally separate, the behaviors of the users (including patients and doctors) on these two types of websites could be related to each other. In particular, how does opening online consultation services impact the offline appointments of doctors? Although this is an important question for healthcare portals, doctors, and policy makers, it has not been rigorously examined in the literature. In this paper, we attempt to bridge this important gap by examining the overall impact of offering online consultations on offline appointments. Our results show that the number of offline appointments for doctors increases after opening an online consultation service. Additionally, we examine how several factors, such as recommendation heat, hospital ranking, and doctor title, moderate the impact of opening online consultation services on doctors' offline appointments. Given that online consultation is a new but important way to connect patients and doctors, our findings provide useful implications for all the stakeholders—doctors, patients, hospitals, and policy makers—regarding how to integrate online and offline channels in the healthcare context. History: Param Singh, Senior Editor; Yuliang (Oliver) Yao, Associate Editor. Funding: This work was supported by the National Natural Science Foundation of China [Grants 72071057, 71922009, 71871080, and 72188101]. Supplemental Material: The online appendix is available at https://doi.org/10.1287/isre.2022.1145. [ABSTRACT FROM AUTHOR]