Illegal content uploads on social platforms have grown rapidly in recent years. While previous research has studied various enforcement efforts to remove illegal content, we consider such enforcement efforts in the setting where the content is sold through a platform firm. Furthermore, we consider the situation in which along with the subscription‐based legal content on the platform, there is free illegal content that may generate revenues through advertisements for the platform. Specifically, we analyze three scenarios of illegal content monitoring: (i) only the content developer monitors, (ii) only the platform firm monitors, and (iii) both the content developer and platform firm monitor the illegal content. We find that, under certain conditions, it is beneficial for the platform firm to exert a higher monitoring effort than the content developer even though the former may gain advertisement revenues through the display of illegal content. In addition, while it is expected that the content developer’s profit is highest when only it exerts the monitoring effort, we observe that the scenario where both players exert monitoring efforts results in a win‐win situation. We also analyze the social welfare under all the three illegal content monitoring scenarios.

AbstractSocial media have been increasingly adopted for organizational purposes but their operational implications are not well understood. Firms’ social media initiatives might facilitate information flow and knowledge sharing within and across organizations, strengthening firm‐customer interaction, and improving internal and external collaboration. In this research we empirically examine the impact of social media initiatives on firms’ operational efficiency and innovativeness. Taking the resource‐based view of firms’ information capability, we consider firms’ social media initiatives as strategic resources for operational improvement. We posit that firms’ social media initiatives enhance dynamic knowledge‐sharing routines through an information‐rich social network, leading to both operational efficiency and innovativeness. Collecting secondary data in a longitudinal setting from multiple sources, we construct dynamic panel data (DPD) models. Based on system generalized method of moments (GMM) estimation, we show that firms’ social media initiatives improve operational efficiency and innovativeness. We identify the importance of an information‐rich social network to the creation of knowledge‐based advantage through firms’ social media initiatives, and discuss the theoretical and managerial implications from the perspective of operations management.

Problem definition E-tailers face a dilemma in addressing the bracketing behaviour, where consumers purchase multiple versions of a product to try at home and return the unsatisfactory ones. While this practice reduces product fit uncertainty, it also results in a surge of returns. Academic/practical relevance Despite this dilemma, how to manage bracketing remains largely under-explored in academic research, particularly in leveraging monetary leniency. Methodology We develop a game-theoretic framework, where the monopoly e-tailer incorporates consumers’ best purchase and return responses into its pricing and return service fee decisions. Results Surprisingly, despite the high reverse logistics cost, the e-tailer can still benefit from bracketing. Managing bracketing involves tailoring pricing and return strategies to product and consumer attributes. Some of these strategies run counter to traditional operations. Specifically, even if the reverse logistics cost is zero, it may still be optimal to charge for returns to extract profit from bracketing or deter bracketing. In addition, the reverse logistics cost should sometimes be incorporated into the price and not, as often, into the return fee, even if it hurts all the consumers. Finally, mitigating fit uncertainty, despite appearing beneficial, could reduce the e-tailer’s overall profit, even if it is costless. Managerial implications Our results offer actionable insights for managing bracketing. First, e-tailers banning bracketing across the board (e.g., Amazon) or applying the same return strategy for most products (e.g., Uniqlo) should develop customised strategies, targeting bracketers, non-bracketers, or both, while offering a partial or full refund and allowing or disallowing returns. Second, e-tailers encouraging bracketing through lenient return policies (e.g., Zappos) could render this practice explicit through mechanisms such as try-on schemes, while strategically employing return fees or pricing to internalise the associated costs. Finally, e-tailers striving to reduce fit uncertainty (e.g., Lululemon) should remain cautious about this practice.