Preferred Allocation Research Articles

Too Few Cooks Spoil the Broth: Division of Labor and Directed Production

Abstract How can a manager influence workers' activity, while knowing little about it? This paper examines a situation where production requires several tasks, and the manager wants to direct production to achieve a preferred allocation of effort across tasks. However, the effort that is required for each task cannot be observed, and the production result is the only indicator of worker activity. This paper illustrates that in this situation, the manager cannot implement the preferred allocation with a single worker. On the other hand, the manager is able to implement the preferred allocation by inducing a game among several workers. Gains to workers from collusion may be eliminated by an ability-dependent, but potentially inefficient, task assignment. These findings provide a new explanation for the division of labor, and bureaucratic features such as ``over"-specialization and ``wrong" task allocation.

Public–private partnership projects in Greece: risk ranking and preferred risk allocation

Project participants, through experience, have an initial perception and predisposition towards risk and the types of risks they are willing and able to undertake. This is equally true for parties interested in public–private partnership (PPP) projects. These initial positions have been registered for the major Greek PPP market stakeholders potentially involved in a PPP arrangement through a survey covering all candidate construction companies, interested financing institutes and a number of public sector entities to be involved in PPPs. Findings revealed that stakeholders were, for the majority of risks identified, in agreement as to preferred risk allocation. Risk allocation preferences for construction companies were compared with similar findings for the UK, a mature PPP market, indicating a possible learning/maturing process based on the particular country background. Conclusions add to other surveys carried out on the subject and should enable public sector clients to establish a more efficient framework for risk allocation, thus reducing negotiations prior to contract award and minimizing the risk of poor risk distribution.

Eliciting preferences for resource allocation in mental health care in Ireland

The proportion of total health care expenditure devoted to mental health care in Ireland, at just below 7%, is low relative to other countries. There have been few studies that have examined the relationship between public preferences for different kinds of health care expenditure and priority setting as undertaken by policy-makers and governments. This paper examines citizen's rankings and willingness to pay for a community-based mental health care programme in Ireland relative to two other programmes: cancer and elderly care. Respondents rank cancer as the most important programme, followed by elderly care and then mental health care. The contingent valuation survey demonstrated that people are willing to make significant tax contributions to new community-based services for people with mental health problems, counteracting the view sometimes expressed that people do not care at all about mental health care provision. However, the survey also found that people tend to value additional spending on mental health care lower than cancer and elderly care programmes.

To Give or Not to Give: Children’s and Adolescents’ Sharing and Moral Negotiations in Economic Decision Situations

This study interconnects developmental psychology of fair and moral behavior with economic game theory. One hundred eighty-nine 9- to 17-year-old students shared a sum of money as individuals and groups with another anonymous group (dictator game). Individual allocations did not differ by age but did by gender and were predicted by participants' preferences for fair allocations. Group decision making followed a majority process. Level of moral reasoning did not predict individual offers, but group members with a higher moral reasoning ability were more influential during group negotiations and in influencing group outcomes. The youngest participants justified offers more frequently by referring to simple distribution principles. Older participants employed more complex reasons to justify deviations from allocation principles.

Analytic Cognitive Task Allocation: a decision model for cognitive task allocation

This paper introduces Analytic Cognitive Task Allocation (Analytic CTA) as a decision model for cognitive task allocation. Analytic CTA can support system designers systematically analyse alternative allocation choices, evaluate them through criterion-based quantitative judgements and integrate partial judgements towards a final allocation decision. Analytic CTA was applied in the design of cognitive task allocation by testing three hypotheses. The hypotheses postulated that Analytic CTA can effectively support system designers in three ways: (a) in the identification of task requirements; (b) in the definition of design trade-offs between human allocation and automation; and (c) in the derivation of the allocation decision. Two groups of system designers allocated cognitive functions from three task scenarios in production planning and control. The experimental group, which was supported by the decision model, made allocation decisions which expressed weak preference for either human allocation or automation, consistent with the experimental tasks which had been selected as to elicit weak preferences. The control group relied on the early selection of an automation technology as the means of structuring the design problem. This involved reducing the task to a version suitable for automation, introduced a pro-automation bias and resulted in allocation decisions expressing strong preference for automation. These results were found in support of the experimental hypotheses.

Individual sense of fairness: an experimental study

Many prior studies have identified that subjects in experiments demonstrate preferences for fair allocations. We present an experimental study designed to test whether a similar concern for fairness manifests itself when the decision maker is choosing among differing probabilistic allocation mechanisms that will all generate an ex post unfair allocation by assigning an indivisible prize to one individual. This investigation is inspired by Karni and Safra (Econometrica, 70, 263–284, 2002 ) in which a structure for preferences for fairness in such an environment was developed. Here we use this model to design experiments that allow us to test for the presence of concern for fairness in individual choice behavior and examine some factors that may affect the intensity of the concern for fairness.

How do children behave when they distribute rewards from task participation?

Children's distributional justice was investigated in two experiments. In Experiment 1, pairs of children played a game in which they guessed which card the experimenter would turn up next. We investigated the effect of age (5-, 7-, and 9-year-olds), gender, country (Indonesia or New Zealand), and instructional set on how the children distributed the sweets at the conclusion of the game. Children usually distributed equally, but five-year-olds often distributed according to neither equity nor equality. All the 7- and 9-year-olds applied the same distribution principle over two rounds of the game. In Experiment 2, many of the same children made an allocation preference in response to a hypothetical scenario. Older children, in particular, often showed differences between their allocation in this experiment and their behaviour in Experiment 1. Overall, Damon's (1975) account of children's ideas of distributional justice held up well as a description of the children's actual behaviour in our experiments.

Effects of feed composition on life history developments in feed intake, metabolism, growth and body composition of European eel, Anguilla anguilla

To examine the effect of feed composition on changes in feed intake and subsequent feed utilization with age, five populations of European eel, with an average initial body weight of 5 g each fed a different diet, were monitored for 302 d. The five feeds differed in their content of crude protein (33–63% DM), crude fat (6–28% DM) and calculated carbohydrates (NFE; 15–42% DM) such that five levels of digestible protein/digestible energy (DP/DE) were realised: 13, 16, 21, 28 and 29 g MJ − 1 . At three points in time, with three size groups, nitrogen and energy balance studies were conducted in which next to feed intake and growth also digestibilities of dry matter, protein, fat, NFE and energy as well as O 2 consumption and NH 4–N excretion were measured. Due to the distinct life history of the semelparous, in the present study predominantly male eel, a well-defined goal in terms of mature size and composition could be inferred, presumably to maximize their lifetime reproductive output. In order to reach this goal the animal needs to survive and to grow and voluntary feed intake of the eels could be adequately described with the feed intake model ‘eating to requirements subject to constraints’, where voluntary feed intake is considered to originate from a requirement for maintenance (survival) and a requirement for growth. Live weight gain is almost completely based on protein deposition (PD) and eels, like other animals, strive to reach a genetically determined growth potential (PDmax) thought to be driven by the difference from the mature protein mass (Ptmax). Body lipid content increases with size and varied with diet from a minimum of 25% at high DP/DE ratios to a maximum of 33% at low DP/DE ratios, at body weights of 130–140 g. Preferable allocation of dietary protein to PD (protein sparing action of non-protein energy) was confirmed as marginal efficiency of protein utilization increased with decreasing DP/DE ratio from 0.29 to 0.54. Marginal energetic efficiency of PD, k p was 0.54 and marginal energetic efficiency of LD, k f varied from 0.67, indicating de novo lipid synthesis (from dietary protein) at high DP/DE ratios, to 0.93, indicating direct lipid synthesis (from dietary lipid) at low DP/DE ratios. Marginal efficiencies did not differ from those of other fish or other farm animals. Differences between fish species in feed intake and utilization of feeds differing in macronutrient composition, as well as life history developments in feed intake and feed utilization are therefore based on differences in growth rate, in turn with mature weight (Ptmax), and body composition (LD/PD ratio).

The Influence of Leisure Preference, Life Priority and Making Time on Regular Participation in Leisure Time Physical Activity

Using an attitude‐behaviour theory approach this study examined the direct and indirect influence of preference, life priority and time allocation on regular participation in leisure‐time physical activity (LTPA). The cross‐sectional study used self‐report questionnaires to collect data from a random sample of 250 people aged 19 to 87 years living in an Australian city. The findings suggest that people's regular participation in LTPA is not directly influenced by their preference for it. Rather, making LTPA a high life priority and allocating time for LTPA are intervening factors that explain the relationship. The outcomes emphasise the importance of encouraging the formation of a preference for physical activity in young children. They suggest all levels of government and the leisure profession emphasise work/life balance by prioritising LTPA, educating people about time management and helping them to develop time management skills.

The European Union and the Member States: Which Level of Government Should Do What? An Empirical Analysis of Europeans' Preferences

In this paper we empirically study the preferences of European citizens concerning the allocation of powers between EU and the Member States using Eurobarometer data from 1995 to 2003. Descriptive analysis highlights a ranking of countries according to their level of Europeanism, and a quite clear pattern of preferences relative to the allocation of competences for specific policy domains. With econometric analysis, first we regress a measure of Europeanism on a number of individual characteristics and, second, we select some policy domains and investigate the determinants of preferences for centralisation of competences at the EU level. Also econometric analysis reveals interesting patterns regarding EU citizens' preferences for allocation of powers.

EFFECTS OF GROUP GOAL AND RESOURCE VALENCE ON ALLOCATION PREFERENCES IN PUBLIC GOOD DILEMMAS

Previous research has not been conclusive as to whether people prefer different or identical allocation principles in distributions of positive and negative outcomes. Thus, in this study, the question of whether or not group goal accounts for preferred allocation of positive and negative outcomes was posed. As hypothesized for division of surpluses, the results showed that relationship-oriented goals predicted preferences for equality, whereas performance-oriented goals predicted preferences for equity. Moreover, the results were the same for allocation of deficits. This suggests that people implicitly have different orientations, or goals, in mind in group situations that similarly influence the way they prefer to allocate positive and negative outcomes. The results also showed that participants allocating deficits deviated to a larger extent from the allocation principles than did participants allocating surpluses.

The analysis and allocation of risks in public private partnerships in infrastructure projects in Nigeria

Governments throughout the world are being forced to review how to fund the increasing demand and rising expectations of their citizens. This is especially relevant for developing countries, which often have limited capital resources to meet the soaring needs for essential infrastructure. This has consequently led to increased involvement of the private sector in the provision of public services, using various forms of Public‐Private Partnerships (PPPs). It is, however, important for both the public and private sectors to understand the various risks associated with PPPs throughout the whole life cycle of the projects in order to guarantee long‐term success. This is especially true in Nigeria and other countries where the use of PPPs are still in the early stages of development. Sixty‐one PPP risk factors were identified from literature and classified into exogenous and endogenous risks. This paper presents the results of the questionnaire survey that investigated the perception of Nigerian construction professionals on the relative importance of the identified risks and their preferences of allocation between the public and private sectors. The results show that the three most important PPP risk factors in Nigeria are “unstable government”, “inadequate experience in PPP” and “availability of finnance”. The respondents’ risk allocation preferences show that while most of the endogenous risk factors could be assigned to the private sector partner, the public sector should retain political and site acquisition risks, while relation‐ship‐based risks should be shared between the private and public sector partners

Buying Influence: Aid Fungibility in a Strategic Perspective

AbstractI study equilibria of non‐cooperative games between an aid donor and a recipient when there is conflict over the allocation of their combined budgets. The general conclusion is that a donor's influence over outcomes is increasing in the share of the available resources it controls; if this share is large enough, aid fungibility is not important as the donor achieves its most preferred allocation. The game‐theoretic approach to fungibility is contrasted with the traditional non‐strategic approach. I argue that the former is superior as it derives final allocations instead of assuming them, making analysis of the sources of influence over outcomes possible.

Senior/Junior Recipient Status and Reward Allocation

This study examines senior/junior recipient status as a possible determinant of perceived fairness of given allocations and allocation preference. Considering status as a feature associated with the cultural dimension of power distance, female university students from India (a high power distance, relatively collectivistic culture) and Canada (a low power distance, individualistic culture) were compared with regard to perceived fairness and allocation preferences in scenarios involving an organisational or an academic setting, with varying senior/junior recipient status, allocation rule combinations, nature of allocation, and the allocator/recipient role. Overall, recipient status effects were incongruent with the expected power distance differences. Further, Canadians perceived more fairness and less unfairness than Indians. They favoured seniority to a greater extent than Indians, possibly because they treated seniority as a component of merit. Indians manifested an equality orientation, and gave variable responses to seniority depending on the nature of allocation, allocator/recipient role, rule combination and their interactive effects. Allocation preferences were affected more by rule combination than by recipient status in both cultures. The need to examine status effects with a modified research design was underlined.

Preferences of the public regarding cutbacks in expenditure for patient care

Increasing costs for patient care may necessitate financial cuts in the health-care budget. Our aim is to examine whether the public prefers cuts for psychiatric rather than medical conditions and how resource allocation preferences are related to illness beliefs and attitudes. A telephone survey involving German adult population was conducted in 2004 (n = 1012). Participants were presented with a list of nine medical and mental diseases including alcoholism, depression, schizophrenia, Alzheimer's disease, cancer, diabetes, rheumatism and AIDS, and were asked to name three conditions where they would prefer to see health-care resources cut. For all conditions we asked about personal attitudes and illness beliefs. People were more willing to have financial resources cut for psychiatric than for medical conditions, with resources for alcoholism having the least public backing. Alzheimer's disease was rated more favourably compared to other mental disorders. Generally, the perception of the severity of a disease was associated with resource allocation decisions, favouring those conditions that were considered to be severe. Mental diseases evoked a far greater desire for social distance than most medical diseases which had considerable influence on resource allocation preferences. The perception of personal responsibility had, in contrast, only limited effect on resource allocation decisions. It varied considerably in the case of psychiatric conditions but was not fundamentally different among medical and mental diseases. Personal susceptibility, treatment effectiveness and the perceived life-threat posed by a disease also had limited effects. According to public resource allocation preferences psychiatric patients are at risk of being structurally discriminated within the health-care system.

On Multi-Period Emissions Trading in the Electricity Sector

Emissions trading schemes on entity level are becoming more and more important in the context of controlling greenhouse gases. The directive on a Europe-wide trading scheme is a prime example. Prior to the start of such a scheme, a number of design features have to be agreed upon. Regarding the allocation of allowances, a distribution that is (almost) free of charge has been the method of choice. An aspect that has interestingly attracted little attention thus far is the question of how to allocate emission rights over time, i.e. in single, subsequent periods that exist in real trading schemes. In this paper, different allocation options are applied to the electricity sector. A power market that mirrors reality with five different types of power plants (hydro, nuclear, lignite, coal and gas) is simulated over two periods. On the demand side, three different load curves are assumed (winter, summer, transition). For each demand curve different elasticities are analysed. Supply and demand are matched on an hourly basis. The allocation is either based on absolute emissions or on a generation benchmark. The base period/generation metric is either constant or updated over time. Thus, four different allocation options exist. It turns out that the electricity sector as a whole gains from the introduction of the instrument. Its aggregated gross margin is considerably higher with an allocation based on a constant period/generation metric. It is thus the preferred allocation option. This result contradicts other recent studies that assumed completely inelastic demand. Single plant operators may, however, win or lose in terms of the net financial impact. On the installation level, preferences regarding the different allocation scheme are a function of the fuel used.

Alcoholism: Illness beliefs and resource allocation preferences of the public

Background Alcohol-dependent patients are at risk of being denied necessary care because of their diagnosis. We sought to find out whether public illness beliefs influence resource allocation decisions of the public, thus putting alcohol-dependent patients at a disadvantage compared to those suffering from other medical and mental disorders. Method A telephone survey involving the adult German population was conducted in 2004 ( n = 1012). Participants were asked to name three out of nine conditions for which they would prefer resources not to be cut should general cutbacks within the health care budget be necessary. For all conditions we asked about personal attitudes and illness beliefs. Results Schizophrenia and alcoholism were chosen least frequently when it was a question of being spared from budget reductions. Compared to other diseases, alcoholism was considered to be particularly self-inflicted and evoked a high desire for social distance. The perceived severity of the disease, the perceived own risk of becoming alcohol dependent, and the notion that alcoholics are themselves responsible for their illness were associated with resource allocation decisions. Conclusion Alcohol-dependent patients are at risk of being structurally discriminated within the health care system.

“Quick and dirty numbers”?: The reliability of a stated-preference technique for the measurement of preferences for resource allocation

We investigated the reliability of an internet-based stated-preference survey to elicit preferences for priority setting using a conjoint study like approach. Preferences were elicited among members of an Internet survey panel in an experimental “allocation of points” task at two times. The main finding is that the survey showed good reliability and most participants consistently adjusted their allocations of points to differences in presented scenarios. At the repetition of the survey, respondents were more likely to prioritize between new treatment programs competing for funding and those that did prioritize discriminated stronger between programs. We found no evidence that respondents were making easy choices or arbitrarily “clicked” through the survey.

Biases in Allocation Under Risk and Uncertainty: Partition Dependence, Unit Dependence, and Procedure Dependence

Previous studies of employee investment in retirement plans suggest that people typically naively diversify their investment funds, tending to allocate 1/n of the total to each of n available instruments (Benartzi & Thaler, 2001). In this paper we provide experimental evidence that this bias extends to allocation among simple chance prospects and demonstrate three new violations of rational choice theory implied by use of the naive diversification strategy. Study 1 demonstrates “partition dependence” in which participants' allocations among a fixed set of investments varies with the hierarchical structure of the option set (e.g., by vendor and instrument). Study 2 demonstrates “unit dependence” in which participants' preferred allocations vary with the metric in which the investment is reported (dollars versus number of shares). Study 3 demonstrates “procedure dependence” in which the bias toward even allocation disappears if participants are asked to choose from a menu of possible portfolios. We show that these results extend to sophisticated participants, simple well-specified gambles and incentivecompatible payoffs. We close with a discussion of theoretical and prescriptive implications.

Reduced sensitivity to sucrose in rats bred for helplessness: a study using the matching law

Anhedonia is a core symptom of depression. As it cannot be directly assessed in rodents, anhedonia is usually inferred from a reduced consumption of, or preference for, a reinforcer. In the present study we tried to improve the measurement of anhedonia by performing a detailed preference analysis based on the generalized matching law and tested its sensitivity in rats congenitally prone (cLH) or resistant (cNLH) to learned helplessness. According to the current interpretation of learned helplessness as a model for depression, a reduction in the rewarding properties of sucrose in cLH rats was hypothesized. Our results revealed that the 'preference allocation' index provided by this test, but not the traditional measures of sucrose consumption or preference over water, was significantly lower in cLH rats, and was correlated with the helpless behaviour as measured in an escape procedure. Therefore, it is clear that more subtle preference measures provided by the analysis of choice using the matching law principles are more sensitive and discriminative than those based on consumption of, or preference for, a single concentration of sucrose over water. Moreover, our data are in agreement with the proposed relationship between helplessness and sucrose preference, and support the usefulness of the cLH and cNLH rats as a model of depression.