The Pygmalion Effect: An Agency Model with Reference Dependent Preferences

We attempt to formulate and explain two types of self-fulfilling prophecy, called the Pygmalion effect (if a supervisor thinks her subordinates will succeed, they are more likely to succeed) and the Galatea effect (if a person thinks he will succeed, he is more likely to succeed). To this purpose, we extend a simple agency model with moral hazard and limited liability by introducing a model of reference dependent preferences (RDP) by Kõszegi and Rabin (2004). We show that the agent with high expectations about his performance can be induced to choose high effort with low-powered incentives. We then show that the principal’s expectation has an important role as an equilibrium selection device.self-fulfilling prophecy, Pygmalion effect, Galatea effect, reference dependent preferences, agency model, moral hazard

Self-assembly of parallel atomic wires and periodic clusters of silicon on a vicinal Si(111) surface

Silicon self-assembly at step edges in the initial stage of homoepitaxial growth on a vicinal Si(111) surface is studied by scanning tunneling microscopy (STM). The resulting atomic structures change dramatically from a parallel array of 0.7 nm wide wires to one dimensionally aligned periodic clusters of the diameter ~ 2 nm and periodicity 2.7 nm in the very narrow range of growth temperatures between 400 and 300 C. These nanostructures are expected to play an important role in future development of silicon quantum computers. Mechanisms leading to such distinct structures are discussed.Comment: Accepted for publication in Phys. Rev. Lett. Numbers of pages and figures are 13 and 3, respectivel