We review the optimality of partial insurance contracts in the presence of moral hazard when consumers are affected by probability weighting. In valuing risky prospects individuals commonly overweight extreme outcomes at the expense of intermediate outcomes; these deviations systematically bias the ex-ante value of insurance. We characterize optimal contracts for the case of perfectly competiti...

This paper presents an operational approach to setting prices for groundwater in accordance with the interannual variability of monsoon rainfall and the dynamic cost of groundwater use to society. The pricing system is designed for the state of Tamil Nadu, India, where groundwater is largely unregulated and the electricity for pumping is heavily subsidized. Depletion of aquifers during the prim...

Without successful large-scale regional evacuations, threats such as hurricanes and wild-fires can cause a large loss of life. In this context, automobiles are oftentimes an essential transportation mode for evacuations, but the ensuing traffic typically overwhelms the roadway capacity and causes congestion on a massive scale. Congestion leads to many problems including longer, costlier, and mo...

The awareness of energy consumption is an important factor for production. Energy consumption is related to costs. Regulations and laws have to be fulfilled. Furthermore, the ecological aspects have to be considered. Nevertheless, competitive goals prohibit an solely energy driven production control. In this paper, we describe the use case of demand-side energy management in the context of the ...

Some companies concentrate on upgrading their supply chain operations. Others focus more on the demand side, seeking to improve the customer relationship processes. Yet the real key to market success is to effectively integrate the two initiatives. By doing so, you can offer customers a greatly enhanced value proposition. And this, in turn, leads to new T raditionally, supply chain management h...

The continuing expansion of Internet media consumption has increased traffic volumes, and hence congestion, on access links. In response, both mobile and wireline ISPs must either increase capacity or perform traffic engineering over existing resources. Unfortunately, provisioning timescales are long, the process is costly, and single-homing means operators cannot balance across the last mile. ...

Consider a seller who is endowed with a fixed number of units of a product that he/she can sell to a price-sensitive and stochastically arriving stream of consumers during a given selling season. The seller’s problem is to dynamically adjust the product’s price to maximize the revenues he/she can collect if no replenishment is possible during the sales horizon. This setting is quite typical of ...