nep-ict New Economics Papers
on Information and Communication Technologies
Issue of 2007‒09‒16
five papers chosen by
Walter Frisch
University Vienna

  1. Detecting discrimination in the hiring process: evidence from an Internet-based search channel By Eriksson, Stefan; Lagerström, Jonas
  2. Cognitive & Relational Distance in Alliance Networks: Evidence on the Knowledge Value Chain in the European ICT Sector By Olivier BROSSARD (LEREPS-GRES); Jérôme VICENTE (LEREPS-GRES)
  3. How Will Online Affiliate Marketing Networks Impact Search Engine Rankings? By Janssen, D.; Heck, E. van
  4. Nonbanks in the Payments System: Vertical Integration Issues By Nicholas Economides; ;
  5. Incomplete information and self-fulfilling prophecies By Pengfei Wang; Yi Wen

  1. By: Eriksson, Stefan (Department of Economics, Uppsala University); Lagerström, Jonas (IFAU - Institute for Labour Market Policy Evaluation)
    Abstract: This paper uses data from an Internet-based CV database to investigate how factors which may be used as a basis for discrimination, such as the searchers’ ethnicity, gender, age and employment status, affect the number of contacts they receive from firms. Since we have access to essentially the same information as the firms, we can handle the problems associated with unobserved heterogeneity better than most existing studies of discrimination. We find that, even when we control for all other differences, searchers who have non-Nordic names, are old or unemployed receive significantly fewer contacts. Moreover, we find that this matters for the hiring outcome: Searchers who receive more contacts have a higher probability of actually getting hired.
    Keywords: Job search; Unobserved heterogeneity; Discrimination
    JEL: J64 J71
    Date: 2007–08–25
    Abstract: This paper deals with the firms’ motives for entering into knowledge partnerships. We start by showing that networking strategies are designed to access external knowledge whilst maintaining at the same time a sufficient level of knowledge appropriation and tradability. The ICT sector (and interplaying ones) is particularly concerned by this accessibility/appropriation trade-off. The questions of modularity, complementarity, compatibility and standardisation are critical in the formation of corporate strategic and technological partnerships. Considering that knowledge in this sector is complex and systemic, we construct a theoretical typology of knowledge partnerships by crossing the levels of cognitive and relational proximity with the knowledge phases of exploration, examination and exploitation. This typology is then tested on empirical data through the use of a classification algorithm. The dataset is based on a sample of strategic alliances in the European ICT sector extracted from SDC Platinum. We show that strategic alliances are clustered in relation to the knowledge phases (exploration, examination, exploitation), and that the alliance categories are characterised by levels of relational and cognitive distance which actually are in keeping with the theoretical predictions.
    Keywords: knowledge networks; knowledge phases; proximities; strategic alliances; ICT sector
    JEL: L22 L24 L63 O31
    Date: 2007
  3. By: Janssen, D.; Heck, E. van (Erasmus Research Institute of Management (ERIM), RSM Erasmus University)
    Abstract: In online affiliate marketing networks advertising web sites offer their affiliates revenues based on provided web site traffic and associated leads and sales. Advertising web sites can have a network of thousands of affiliates providing them with web site traffic through hyperlinks on their web sites. Search engines such as Google, MSN, and Yahoo, consider hyperlinks as a proof of quality and/or reliability of the linked web sites, and therefore use them to determine the relevance of web sites with regard to search queries. In this research we investigate the potential impact of online affiliate marketing networks on the ranking of advertisers? web sites in search results. This article empirically explores how seven different affiliate marketing networks affect the rankings of the advertising web sites within web search engines. The field study followed intensively seven online affiliate marketing networks for twelve weeks after their launch. The results indicate that newly started affiliate networks effectively improve the rankings of advertising web sites in search engine results. Also, it was found that the effects of affiliate marketing networks on search engine rankings were smaller for advertising web sites operating in highly competitive markets. Another finding was that a growth in visitors coming from search engines was present as a result of the improvement of search engine rankings. Finally, the results indicate that cost-benefit metrics associated with affiliate marketing programs, such as the average marketing cost will decrease when the positive effects of affiliate marketing on search engine rankings are taken into account.
    Keywords: Online Affiliate Marketing Networks;Search Engine Rankings;Advertising;Hyperlinks;
    Date: 2007–07–03
  4. By: Nicholas Economides (Stern School of Business, New York University); ;
    Abstract: We discuss and evaluate the incentives for vertical expansion and vertical mergers in the payments systems industry paying particular attention to the implications of the existence of network effects in this industry. We assess the incentives of large merchants to extend vertically into payments systems, noting that this incentive is maximized when there is significant market power in payments systems and merchants are not sufficiently compensated for the business they bring to the network.
    Keywords: payments system; credit cards; debit cards; non-banks; vertical integration; market power; monopoly
    JEL: L13 L42 L50 L80
    Date: 2007–08
  5. By: Pengfei Wang; Yi Wen
    Abstract: This paper shows that incomplete information can be a rich source of sunspots equilibria. This is demonstrated in a standard dynamic general equilibrium model of monopolistic competition … la Dixit-Stiglitz. In the absence of fundamental shocks, the model has a unique certainty (fundamental) equilibrium, but there are also multiple stochastic (sunspots) equilibria that are not mere randomizations over fundamental equilibria. In other words, sunspots can exist in infinite-horizon dynamic models with a unique saddle path steady state. In contrast to the recent sunspots literature (e.g., Benhabib and Farmer 1994), sunspots arising under incomplete information can be serially correlated and are robust to parameters associated with production technologies and preferences. Markup is always countercyclical in sunspots equilibria (which is consistent with empirical evidence) and fluctuations driven by sunspots look very similar to fluctuations driven by technology shocks.
    Keywords: Business cycles ; Prices
    Date: 2007

This nep-ict issue is ©2007 by Walter Frisch. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.