When designing a contest to motivate effort by salespeople, service employees, franchisees or product development teams, one of the key questions faced by managers is: What should be the optimal proportion of winners and losers? Prevailing marketing theory predicts that the proportion of winners in a contest should always be lower than the proportion of losers. Not only has this theory not been...

Groups of humans are often able to find ways to cooperate with one another in complex, temporally extended social dilemmas. Models based on behavioral economics are only able to explain this phenomenon for unrealistic stateless matrix games. Recently, multi-agent reinforcement learning has been applied to generalize social dilemma problems to temporally and spatially extended Markov games. Howe...

A government designs transfers to agents in the absence of information on their preferences. The second-best allocation is equal sharing among citizens when the awards are deterministic. We provide a necessary and su cient condition under which lotteries improve upon the egalitarian outcome. The condition requires that the citizens with large social weights have low risk aversion, and that the ...

We examine how different welfarist frameworks evaluate the social value of mortality risk reduction. These frameworks include classical, distributively unweighted cost-benefit analysis--i.e., the "value per statistical life" (VSL) approach-and various social welfare functions (SWFs). The SWFs are either utilitarian or prioritarian, applied to policy choice under risk in either an "ex post" or "...

This note shows that Machina's (1982) assumption that preferences over lotteries are smooth has some economic implications. We show that Fr echet di erentiability implies that preferences represent second order risk aversion (as well as conditional second order risk aversion). This implies, among other things, that decision makers buy full insurance only at the absence of marginal loading. We a...

The sensitivity of the optimal control of carbon dioxide emissions to the specification of the social welfare function is systematically explored using the FUND model. Increasing risk aversion emphasises climate change damages relative to emission reduction costs, but at the same time increases the discount rate of consumption. Without international co-operation, the discount rate effect domina...

An unfunded Social Security system faces the major risk, sometimes referred to as ”political risk”, that future generations do not agree to contribute. In order to account properly for this risk, the paper considers a political process in which the support to the system is asked from each new born generation. The analysis is conducted in an overlapping generations economy that is subject to mac...

During face-to-face interactions typically developing individuals use gaze aversion (GA), away from their questioner, when thinking. GA is also used when individuals with autism (ASD) and Williams syndrome (WS) are thinking during question-answer interactions. We investigated GA strategies during face-to-face social style interactions with familiar and unfamiliar interlocutors. Participants wit...

We use a laboratory experiment to examine whether and to what extent other-regarding preferences (efficiency, inequality aversion and maximin concerns) of team managers influence their management style in choice under risk. We find that managers who prefer efficiency are more likely to exercise an autocratic management style by ignoring preferences of their team members. Equality concerns have ...