Consider a setting in which a principal induces effort from an agent to reduce the arrival rate of a Poisson process of adverse events. The effort is costly to the agent, and unobservable to the principal, unless the principal is monitoring the agent. Monitoring ensures effort but is costly to...

This paper studies optimal task assignments in a setting where agents are expectation-based loss averse according to KoszegiRabin (2006) and KoszegiRabin (2007) and are compensated according to an aggregated performance measure in which tasks are technologically independent. We show that the...

Recent empirical studies conclude that small firms have higher but more variable growth rates than large firms. To explore the effect of this size-dependence regularity on moral hazard and investment, we develop a continuous-time agency model with time-varying firm size. Firm size is a diffusion...

In this chapter we study dynamic incentive models in which risk sharing is endogenously limited by the presence of informational or enforcement frictions. We comprehensively overview one of the most important tools for the analysis such problems—the theory of recursive contracts. Recursive...

This paper investigates the optimal management of supply disruptions by a manufacturer who uses order inflation and/or investments in process reliability when contracting two risk-averse suppliers. We consider that these investments can be subject to moral hazard. Technically we solve a...

Purpose: To demonstrate a simple mathematical model for evaluating operational decisions for preparing compounded sterile products in a hospital pharmacy.Summary: This paper describes a simple mathematical model, based on a small set of parameters easily estimated from existing data. This model...

Evolution explains the way the natural world changes over time. It can also explain changes in the artificial world, such as the way ideas replicate, alter, and merge. This analogy has led to a family of related computer procedures called evolutionary algorithms. These algorithms are being used...

In this work, we solve a real-world facility location problem by means of a mixed integer linear programming model. The problem is faced by an Italian multi-utility company operating in the sector of waste management. The company works in several Italian regions to collect and treat the urban...

Context. A method for constructing an algorithm for stabilizing the interoperability of a production line is considered. The object of the study was a model of a multi-operational production line. Objective. The goal of the work is to develop a method for constructing an optimal algorithm for...

PRECON S.A is a manufacturing company dedicated to produce prefabricated concrete parts to several industries as rail transportation and agricultural industries.Recently, PRECON signed a contract with RENFE, the Spanish National Rail Transportation Company to manufacture pre-stressed concrete...