Seminer Duyurusu (12 Şubat, 2016)



How should a principal reward and support agents', possibly non-attributable, success?


Yigal Gerchak,

(Tel Aviv University, Israel) 



Principal-Agent models with multiple parallel agents typically assume that the principal wishes to maximize the sum of the agents' achievements (net of the rewards paid to them). But in many settings all that the principal needs is that at least one agent will be successful. We consider a scenario where an agent can exert high or low e ort which affects its success probability as well as disutility of effort. We identify settings where the principal actually wants agents to refrain from high effort in order to save expected compensation. When the success of a project cannot be attributed to a specific agent, so that the principal can only observe whether at least one of multiple agents was successful, the principal's desire for high effort decreases. High effort is only favorable if the project's revenues in case of success are large enough or for intermediate levels of the ex-ante probability of success. We also investigate settings where the principal can increase the agents' probability of success by providing support to the agents. We show that the principal will provide agents with less support when only the group's success is observable as compared to scenarios where the agents' individual success is observable.


Short Bio: 

Yigal Gerchak is a Professor of Industrial Engineering at Tel Aviv University. He obtained his B.A. degree in Economics and Statistics from Tel Aviv University. Subsequently, he received his M.S. degree from the same university in Operations Research. Dr. Gerchak obtained his Ph.D. from the University of British Columbia in Management Science. He held academic positions at Concordia University and the University of Waterloo before moving to Tel Aviv in 2000. Dr. Gerchak has published more than 100 articles in refereed journals, and he has served on the editorial boards of many prestigious journals. His main research interests are Game Theoretic Analysis of Supply Chains, Decision Analysis, and Applied Probability and Mathematical Statistics.


All interested are cordially invited.  


DATE:  February 12, 2016 

TIME:  Friday, 15:00-16:00