A theory of reference-dependent behavior

Extensive field and experimental evidence in a variety of environments show that behavior depends on a reference point. This paper provides an axiomatic characterization of this dependence. We proceed by imposing gradually more structure on both choice correspondences and preference relations, requiring increasingly higher levels of rationality, and freeing the decision-maker from certain types of inconsistencies. The appropriate degree of behavioral structure will depend on the phenomenon that is to be modeled. Lastly, we provide two applications of our work: one to model the status-quo bias, and another to model addictive behavior.

Discrete analysis of dividend payments in a non-life insurance portfolio

The process of free reserves in a non-life insurance portfolio as defined in the classical model of risk theory is modified by the introduction of dividend policies that set maximum levels for the accumulation of reserves. The first part of the work formulates the quantification of the dividend payments via the expectation of their current value under diferent hypotheses. The second part presents a solution based on a system of linear equations for discrete dividend payments in the case of a constant dividend barrier, illustrated by solving a specific case.

Discrete analysis of dividend payments in a non-life insurance portfolio

The process of free reserves in a non-life insurance portfolio as defined in the classical model of risk theory is modified by the introduction of dividend policies that set maximum levels for the accumulation of reserves. The first part of the work formulates the quantification of the dividend payments via the expectation of their current value under diferent hypotheses. The second part presents a solution based on a system of linear equations for discrete dividend payments in the case of a constant dividend barrier, illustrated by solving a specific case.

The InterActive Choice Aid: A new approach to supporting online consumer decision making

Interactive Choice Aid (ICA) is a decision aid, introduced in this paper, that systematically assists consumers with online purchase decisions. ICA integrates aspects from prescriptive decision theory, insights from descriptive decision research, and practical considerations; thereby combining pre-existing best practices with novel features. Instead of imposing an objectively ideal but unnatural decision procedure on the user, ICA assists the natural process of human decision-making by providing explicit support for the execution of the user's decision strategies. The application contains an innovative feature for in-depth comparisons of alternatives through which users' importance ratings are elicited interactively and in a playful way. The usability and general acceptance of the choice aid was studied; results show that ICA is a promising contribution and provides insights that may further improve its usability.

The evolution of unicoloniality in ant societies : recognition, dispersal and population genetic structure

Introduction Societies of ants, bees, wasps and termites dominate many terrestrial ecosystems (Wilson 1971). Their evolutionary and ecological success is based upon the regulation of internal conflicts (e.g. Ratnieks et al. 2006), control of diseases (e.g. Schmid-Hempel 1998) and individual skills and collective intelligence in resource acquisition, nest building and defence (e.g. Camazine 2001). Individuals in social species can pass on their genes not only directly trough their own offspring, but also indirectly by favouring the reproduction of relatives. The inclusive fitness theory of Hamilton (1963; 1964) provides a powerful explanation for the evolution of reproductive altruism and cooperation in groups with related individuals. The same theory also led to the realization that insect societies are subject to internal conflicts over reproduction. Relatedness of less-than-one is not sufficient to eliminate all incentive for individual selfishness. This would indeed require a relatedness of one, as found among cells of an organism (Hardin 1968; Keller 1999). The challenge for evolutionary biology is to understand how groups can prevent or reduce the selfish exploitation of resources by group members, and how societies with low relatedness are maintained. In social insects the evolutionary shift from single- to multiple queens colonies modified the relatedness structure, the dispersal, and the mode of colony founding (e.g. (Crozier & Pamilo 1996). In ants, the most common, and presumably ancestral mode of reproduction is the emission of winged males and females, which found a new colony independently after mating and dispersal flights (Hölldobler & Wilson 1990). The alternative reproductive tactic for ant queens in multiple-queen colonies (polygyne) is to seek to be re-accepted in their natal colonies, where they may remain as additional reproductives or subsequently disperse on foot with part of the colony (budding) (Bourke & Franks 1995; Crozier & Pamilo 1996; Hölldobler & Wilson 1990). Such ant colonies can contain up to several hundred reproductive queens with an even more numerous workforce (Cherix 1980; Cherix 1983). As a consequence in polygynous ants the relatedness among nestmates is very low, and workers raise brood of queens to which they are only distantly related (Crozier & Pamilo 1996; Queller & Strassmann 1998). Therefore workers could increase their inclusive fitness by preferentially caring for their closest relatives and discriminate against less related or foreign individuals (Keller 1997; Queller & Strassmann 2002; Tarpy et al. 2004). However, the bulk of the evidence suggests that social insects do not behave nepotistically, probably because of the costs entailed by decreased colony efficiency or discrimination errors (Keller 1997). Recently, the consensus that nepotistic behaviour does not occur in insect colonies was challenged by a study in the ant Formica fusca (Hannonen & Sundström 2003b) showing that the reproductive share of queens more closely related to workers increases during brood development. However, this pattern can be explained either by nepotism with workers preferentially rearing the brood of more closely related queens or intrinsic differences in the viability of eggs laid by queens. In the first chapter, we designed an experiment to disentangle nepotism and differences in brood viability. We tested if workers prefer to rear their kin when given the choice between highly related and unrelated brood in the ant F. exsecta. We also looked for differences in egg viability among queens and simulated if such differences in egg viability may mistakenly lead to the conclusion that workers behave nepotistically. The acceptance of queens in polygnous ants raises the question whether the varying degree of relatedness affects their share in reproduction. In such colonies workers should favour nestmate queens over foreign queens. Numerous studies have investigated reproductive skew and partitioning of reproduction among queens (Bourke et al. 1997; Fournier et al. 2004; Fournier & Keller 2001; Hammond et al. 2006; Hannonen & Sundström 2003a; Heinze et al. 2001; Kümmerli & Keller 2007; Langer et al. 2004; Pamilo & Seppä 1994; Ross 1988; Ross 1993; Rüppell et al. 2002), yet almost no information is available on whether differences among queens in their relatedness to other colony members affects their share in reproduction. Such data are necessary to compare the relative reproductive success of dispersing and non-dispersing individuals. Moreover, information on whether there is a difference in reproductive success between resident and dispersing queens is also important for our understanding of the genetic structure of ant colonies and the dynamics of within group conflicts. In chapter two, we created single-queen colonies and then introduced a foreign queens originating from another colony kept under similar conditions in order to estimate the rate of queen acceptance into foreign established colonies, and to quantify the reproductive share of resident and introduced queens. An increasing number of studies have investigated the discrimination ability between ant workers (e.g. Holzer et al. 2006; Pedersen et al. 2006), but few have addressed the recognition and discrimination behaviour of workers towards reproductive individuals entering colonies (Bennett 1988; Brown et al. 2003; Evans 1996; Fortelius et al. 1993; Kikuchi et al. 2007; Rosengren & Pamilo 1986; Stuart et al. 1993; Sundström 1997; Vásquez & Silverman in press). These studies are important, because accepting new queens will generally have a large impact on colony kin structure and inclusive fitness of workers (Heinze & Keller 2000). In chapter three, we examined whether resident workers reject young foreign queens that enter into their nest. We introduced mated queens into their natal nest, a foreign-female producing nest, or a foreign male-producing nest and measured their survival. In addition, we also introduced young virgin and mated queens into their natal nest to examine whether the mating status of the queens influences their survival and acceptance by workers. On top of polgyny, some ant species have evolved an extraordinary social organization called 'unicoloniality' (Hölldobler & Wilson 1977; Pedersen et al. 2006). In unicolonial ants, intercolony borders are absent and workers and queens mix among the physically separated nests, such that nests form one large supercolony. Super-colonies can become very large, so that direct cooperative interactions are impossible between individuals of distant nests. Unicoloniality is an evolutionary paradox and a potential problem for kin selection theory because the mixing of queens and workers between nests leads to extremely low relatedness among nestmates (Bourke & Franks 1995; Crozier & Pamilo 1996; Keller 1995). A better understanding of the evolution and maintenance of unicoloniality requests detailed information on the discrimination behavior, dispersal, population structure, and the scale of competition. Cryptic genetic population structure may provide important information on the relevant scale to be considered when measuring relatedness and the role of kin selection. Theoretical studies have shown that relatedness should be measured at the level of the `economic neighborhood', which is the scale at which intraspecific competition generally takes place (Griffin & West 2002; Kelly 1994; Queller 1994; Taylor 1992). In chapter four, we conducted alarge-scale study to determine whether the unicolonial ant Formica paralugubris forms populations that are organised in discrete supercolonies or whether there is a continuous gradation in the level of aggression that may correlate with genetic isolation by distance and/or spatial distance between nests. In chapter five, we investigated the fine-scale population structure in three populations of F. paralugubris. We have developed mitochondria) markers, which together with the nuclear markers allowed us to detect cryptic genetic clusters of nests, to obtain more precise information on the genetic differentiation within populations, and to separate male and female gene flow. These new data provide important information on the scale to be considered when measuring relatedness in native unicolonial populations.

Evolutionarily stable learning schedules and cumulative culture in discrete generation models.

Individual learning (e.g., trial-and-error) and social learning (e.g., imitation) are alternative ways of acquiring and expressing the appropriate phenotype in an environment. The optimal choice between using individual learning and/or social learning may be dictated by the life-stage or age of an organism. Of special interest is a learning schedule in which social learning precedes individual learning, because such a schedule is apparently a necessary condition for cumulative culture. Assuming two obligatory learning stages per discrete generation, we obtain the evolutionarily stable learning schedules for the three situations where the environment is constant, fluctuates between generations, or fluctuates within generations. During each learning stage, we assume that an organism may target the optimal phenotype in the current environment by individual learning, and/or the mature phenotype of the previous generation by oblique social learning. In the absence of exogenous costs to learning, the evolutionarily stable learning schedules are predicted to be either pure social learning followed by pure individual learning ("bang-bang" control) or pure individual learning at both stages ("flat" control). Moreover, we find for each situation that the evolutionarily stable learning schedule is also the one that optimizes the learned phenotype at equilibrium.

Multidelayed random walks: Theory and application to the neolithic transition in Europe

We present a model in which particles (or individuals of a biological population) disperse with a rest time between consecutive motions (or migrations) which may take several possible values from a discrete set. Particles (or individuals) may also react (or reproduce). We derive a new equation for the effective rest time T˜ of the random walk. Application to the neolithic transition in Europe makes it possible to derive more realistic theoretical values for its wavefront speed than those following from the single-delayed framework presented previously [J. Fort and V. Méndez, Phys. Rev. Lett. 82, 867 (1999)]. The new results are consistent with the archaeological observations of this important historical process

Field Sales Management Control: Towards a Multi-Level Theory

The purpose of this dissertation is to increase the understanding and knowledge of field sales management control systems (i.e. sales managers monitoring, directing, evaluating and rewarding activities) and their potential consequences on salespeople. This topic is important because research conducted in the past has indicated that the choice of control system type can on the other hand have desirable consequences, such as high levels of motivation and performance, and on the other hand leadto harmful unintended consequences, such as opportunistic or unethical behaviors. Despite the fact that marketing and sales management control systems have been under rigorous research for over two decades, it still is at a very early stage of development, and several inconsistencies can be found in the research results. This dissertation argues that these inconsistencies are mainly derived from misspecification of the level of analysis in the past research. These different levels of analysis (i.e. strategic, tactical, and operational levels) involve very different decision-making situations regarding the control and motivation of sales force, which should be taken into consideration when conceptualizing the control. Moreover, the study of salesperson consequences of a field sales management control system is actually a cross-level phenomenon, which means that at least two levels of analysis are simultaneously involved. The results of this dissertation confirm the need to re-conceptualize the field sales management control system concept. It provides empirical evidence for the assertion that control should be conceptualized with more details atthe tactical/operational level of analysis than at the strategic levelof analysis. Moreover, the results show that some controls are more efficiently communicated to field salespeople than others. It is proposed that this difference is due to different purposes of control; some controls aredesigned for influencing salespersons' behavior (aim at motivating) whereas some controls are designed to aid decision-making (aim at providing information). According to the empirical results of this dissertation, the both types of controls have an impact to the sales force, but this impactis not as strong as expected. The results obtained in this dissertation shed some light to the nature of field sales management control systems, and their consequences on salespeopl

Indicators for the characterization of discrete Choquet integrals

Ordered weighted averaging (OWA) operators and their extensions are powerful tools used in numerous decision-making problems. This class of operator belongs to a more general family of aggregation operators, understood as discrete Choquet integrals. Aggregation operators are usually characterized by indicators. In this article four indicators usually associated with the OWA operator are extended to discrete Choquet integrals: namely, the degree of balance, the divergence, the variance indicator and Renyi entropies. All of these indicators are considered from a local and a global perspective. Linearity of indicators for linear combinations of capacities is investigated and, to illustrate the application of results, indicators of the probabilistic ordered weighted averaging -POWA- operator are derived. Finally, an example is provided to show the application to a specific context.

Role of references in international industrial marketing : a theory-building case study about supplier’s processes of utilizing references

Scientific studies regarding specifically references do not seem to exist. However, the utilization of references is an important practice for many companies involved in industrial marketing. The purpose of the study is to increase the understanding about the utilization of references in international industrial marketing in order to contribute to the development of a theory of reference behavior. Specifically, the modes of reference usage in industry, the factors affecting a supplier's reference behavior, and the question how references are actually utilized, are explored in the study. Due to the explorative nature of the study, a research design was followed where theory and empirical studies alternated. An Exploratory Framework was developed to guide a pilot case study that resulted in Framework 1. Results of the pilot study guided an expanded literature review that was used to develop first a Structural Framework and a Process Framework which were combined in Framework 2. Then, the second empirical phase of the case study was conducted in the same (pilot) case company. In this phase, Decision Systems Analysis (DSA) was used as the analysis method. The DSA procedure consists of three interviewing waves: initial interviews, reinterviews, and validating interviews. Four reference decision processes were identified, described and analyzed in the form of flowchart descriptions. The flowchart descriptions were used to explore new constructs and to develop new propositions to develop Framework 2 further. The quality of the study was ascertained by many actions in both empirical parts of the study. The construct validity of the study was ascertained by using multiple sources of evidence and by asking the key informant to review the pilot case report. The DSA method itself includes procedures assuring validity. Because of the choice to conduct a single case study, external validity was not even pursued. High reliability was pursued through detailed documentation and thorough reporting of evidence. It was concluded that the core of the concept of reference is a customer relationship regardless of the concrete forms a reference might take in its utilization. Depending on various contingencies, references might have various tasks inside the four roles of increasing 1) efficiency of sales and sales management, 2) efficiency of the business, 3) effectiveness of marketing activities, and 4) effectiveness in establishing, maintaining and enhancing customer relationships. Thus, references have not only external but internal tasks as well. A supplier's reference behavior might be affected by many hierarchical conditions. Additionally, the empirical study showed that the supplier can utilize its references as a continuous, all pervasive decision making process through various practices. The process includes both individual and unstructured decision making subprocesses. The proposed concept of reference can be used to guide a reference policy recommendable for companies for which the utilization of references is important. The significance of the study is threefold: proposing the concept of reference, developing a framework of a supplier's reference behavior and its short term process of utilizing references, and conceptual structuring of an unstructured and in industrial marketing important phenomenon to four roles.

Fronts with continuous waiting-time distributions: Theory and application to virus infections

We generalize to arbitrary waiting-time distributions some results which were previously derived for discrete distributions. We show that for any two waiting-time distributions with the same mean delay time, that with higher dispersion will lead to a faster front. Experimental data on the speed of virus infections in a plaque are correctly explained by the theoretical predictions using a Gaussian delay-time distribution, which is more realistic for this system than the Dirac delta distribution considered previously [J. Fort and V. Méndez, Phys. Rev. Lett.89, 178101 (2002)]

Rationalizability of Choice Functions on General Domains without Full Transitivity

The rationalizability of a choice function by means of a transitive relation has been analyzed thoroughly in the literature. However, not much seems to be known when transitivity is weakened to quasi-transitivity or acyclicity. We describe the logical relationships between the different notions of rationalizability involving, for example, the transitivity, quasi-transitivity, or acyclicity of the rationalizing relation. Furthermore, we discuss sufficient conditions and necessary conditions for rational choice on arbitrary domains. Transitive, quasi-transitive, and acyclical rationalizability are fully characterized for domains that contain all singletons and all two-element subsets of the universal set.

A Theory of Random Consumer Demand

This paper presents a new theory of random consumer demand. The primitive is a collection of probability distributions, rather than a binary preference. Various assumptions constrain these distributions, including analogues of common assumptions about preferences such as transitivity, monotonicity and convexity. Two results establish a complete representation of theoretically consistent random demand. The purpose of this theory of random consumer demand is application to empirical consumer demand problems. To this end, the theory has several desirable properties. It is intrinsically stochastic, so the econometrician can apply it directly without adding extrinsic randomness in the form of residuals. Random demand is parsimoniously represented by a single function on the consumption set. Finally, we have a practical method for statistical inference based on the theory, described in McCausland (2004), a companion paper.

Bayesian Analysis for a Theory of Random Consumer Demand: The Case of Indivisible Goods

McCausland (2004a) describes a new theory of random consumer demand. Theoretically consistent random demand can be represented by a \"regular\" \"L-utility\" function on the consumption set X. The present paper is about Bayesian inference for regular L-utility functions. We express prior and posterior uncertainty in terms of distributions over the indefinite-dimensional parameter set of a flexible functional form. We propose a class of proper priors on the parameter set. The priors are flexible, in the sense that they put positive probability in the neighborhood of any L-utility function that is regular on a large subset bar(X) of X; and regular, in the sense that they assign zero probability to the set of L-utility functions that are irregular on bar(X). We propose methods of Bayesian inference for an environment with indivisible goods, leaving the more difficult case of indefinitely divisible goods for another paper. We analyse individual choice data from a consumer experiment described in Harbaugh et al. (2001).

Aumann-Shapley Pricing : A Reconsideration of the Discrete Case

We reconsider the following cost-sharing problem: agent i = 1,...,n demands a quantity xi of good i; the corresponding total cost C(x1,...,xn) must be shared among the n agents. The Aumann-Shapley prices (p1,...,pn) are given by the Shapley value of the game where each unit of each good is regarded as a distinct player. The Aumann-Shapley cost-sharing method assigns the cost share pixi to agent i. When goods come in indivisible units, we show that this method is characterized by the two standard axioms of Additivity and Dummy, and the property of No Merging or Splitting: agents never find it profitable to split or merge their demands.