Task assignment under agent loss aversion

Incentive Design under Loss Aversion

Compensation schemes often reward success but do not penalize failure. Fixed salaries with stock options or bonuses have this feature. Yet the standard principal–agent model implies that pay is normally monotonically increasing in performance. This paper shows that, under loss aversion, there will be intervals over which pay is insensitive to performance, with the use of carrots but not sticks ...

Competition under Consumer Loss Aversion ∗

We address the effect of contextual consumer loss aversion on firm strategy in imperfect competition. Consumers are fully informed about match value and price at the moment of purchase. However, some consumers are initially uninformed about their tastes and form a reference point consisting of an expected match—value and price distribution, while others are perfectly informed all the time. We s...

Intertemporal Incentives Under Loss Aversion

This paper studies the intertemporal allocation of incentives in a repeated moral hazard model with reference-dependent preferences as in Kőszegi and Rabin (2009). Besides consumption utility, the agent experiences utility from the change in his beliefs about present and future effort and income. When effort plans are rational, the prospect of being disappointed by the outcome realization equal...

Task Assignment and Scheduling under Memory Constraints

Many DSP and image processing embedded systems have hard memory constraints which makes it difficult to find a good task assignment and scheduling which fulfill these constraints. This paper presents a new heuristic developed for task assignment and scheduling for such systems. These systems have also a large number of constraints of different nature, such as cost, execution time, memory capaci...

Learning Preferences Under Noise and Loss Aversion: An Optimization Approach