The Hidden Costs and Returns of Incentives - Trust and Trustworthiness among CEOs

We examine experimentally how Chief Executive Officers (CEOs) respond to incentives and how they provide incentives in situations requiring trust and trustworthiness. As a control we compare the behavior of CEOs with the behavior of students. We find that CEOs are considerably more trusting and exhibit more trustworthiness than students - thus reaching substantially higher efficiency levels than students. Moreover, we find that, for CEOs as well as for students, incentives based on explicit threats to penalize shirking backfire by inducing less trustworthy behavior - giving rise to hidden costs of incentives. However, the availability of penalizing incentives also creates hidden returns: if a principal expresses trust by voluntarily refraining from implementing the punishment threat, the agent exhibits significantly more trustworthiness than if the punishment threat is not available. Thus trust seems to reinforce trustworthy behavior. Overall, trustworthiness is highest if the threat to punish is available but not used, while it is lowest if the threat to punish is used. Paradoxically, however, most CEOs and students use the punishment threat, although CEOs use it significantly less.

THE HIDDEN COSTS AND RETURNS OF INCENTIVES — TRUST AND TRUSTWORTHINESS AMONG CEOs

We examine experimentally how Chief Executive Officers (CEOs) respond to incentives and how they provide incentives in situations requiring trust and trustworthiness. As a control we compare the behavior of CEOs with the behavior of students. We find that CEOs are considerably more trusting and exhibit more trustworthiness than students—thus reaching substantially higher efficiency levels than students. Moreover, we find that, for CEOs as well as for students, incentives based on explicit threats to penalize shirking backfire by inducing less trustworthy behavior—giving rise to hidden costs of incentives. However, the availability of penalizing incentives also creates hidden returns: if a principal expresses trust by voluntarily refraining from implementing the punishment threat, the agent exhibits significantly more trustworthiness than if the punishment threat is not available. Thus trust seems to reinforce trustworthy behavior. Overall, trustworthiness is highest if the threat to punish is available but not used, while it is lowest if the threat to punish is used. Paradoxically, however, most CEOs and students use the punishment threat, although CEOs use it significantly less.HIDDEN COSTS, RETURNS OF INCENTIVES, TRUST, TRUSTWORTHINESS, CEO

A Tight High-Order Entropic Quantum Uncertainty Relation With Applications

We derive a new entropic quantum uncertainty relation involving min-entropy. The relation is tight and can be applied in various quantum-cryptographic settings. Protocols for quantum 1-out-of-2 Oblivious Transfer and quantum Bit Commitment are presented and the uncertainty relation is used to prove the security of these protocols in the bounded quantum-storage model according to new strong security definitions. As another application, we consider the realistic setting of Quantum Key Distribution (QKD) against quantum-memory-bounded eavesdroppers. The uncertainty relation allows to prove the security of QKD protocols in this setting while tolerating considerably higher error rates compared to the standard model with unbounded adversaries. For instance, for the six-state protocol with one-way communication, a bit-flip error rate of up to 17% can be tolerated (compared to 13% in the standard model). Our uncertainty relation also yields a lower bound on the min-entropy key uncertainty against known-plaintext attacks when quantum ciphers are composed. Previously, the key uncertainty of these ciphers was only known with respect to Shannon entropy.Comment: 21 pages; editorial changes, additional applicatio

CW and pulsed electrically detected magnetic resonance spectroscopy at 263 GHz/12 T on operating amorphous silicon solar cells

Here we describe a new high frequency/high field continuous wave and pulsed electrically detected magnetic resonance (CW EDMR and pEDMR) setup, operating at 263 GHz and resonance fields between 0 and 12 T. Spin dependent transport in illuminated hydrogenated amorphous silicon p-i-n solar cells at 5 K and 90 K was studied by in operando 263 GHz CW and pEDMR alongside with complementary X-band CW EDMR. Benefiting from the superior resolution at 263 GHz, we were able to better resolve EDMR signals originating from spin dependent hopping and recombination processes. 5 K EDMR spectra were found to be dominated by conduction and valence band tale states involved in spin dependent hopping, with additional contributions from triplet exciton states. 90 K EDMR spectra could be assigned to spin pair recombination involving conduction band tail states and dangling bonds as dominating spin dependent transport process, with additional contributions from valence band tail and triplet exciton states.Comment: 8 pages, 4 figure

The Joker effect: cooperation driven by destructive agents

Understanding the emergence of cooperation is a central issue in evolutionary game theory. The hardest setup for the attainment of cooperation in a population of individuals is the Public Goods game in which cooperative agents generate a common good at their own expenses, while defectors "free-ride" this good. Eventually this causes the exhaustion of the good, a situation which is bad for everybody. Previous results have shown that introducing reputation, allowing for volunteer participation, punishing defectors, rewarding cooperators or structuring agents, can enhance cooperation. Here we present a model which shows how the introduction of rare, malicious agents -that we term jokers- performing just destructive actions on the other agents induce bursts of cooperation. The appearance of jokers promotes a rock-paper-scissors dynamics, where jokers outbeat defectors and cooperators outperform jokers, which are subsequently invaded by defectors. Thus, paradoxically, the existence of destructive agents acting indiscriminately promotes cooperation.Comment: Accepted for publication in the Journal of Theoretical Biology (JTB

Social Preferences and the Efficiency of Bilateral Exchange

Under what conditions do social preferences, such as altruism or a concern for fair outcomes, generate efficient trade? I analyze theoretically a simple bilateral exchange game: Each player sequentially takes an action that reduces his own material payoff but increases the other player’s. Each player’s preferences may depend on both his/her own material payoff and the other player’s. I identify necessary conditions and sufficient conditions on the players’ preferences for the outcome of their interaction to be Pareto efficient. The results have implications for interpreting the rotten kid theorem, gift exchange in the laboratory, and gift exchange in the field

Monitoring and Pay: An Experiment on Employee Performance under Endogenous Supervision

We present an experimental test of a shirking model where monitoring intensity is endogenous and effort a continuous variable. Wage level, monitoring intensity and consequently the desired enforceable effort level are jointly determined by the maximization problem of the firm. As a result, monitoring and pay should be complements. In our experiment, between and within treatment variation is qualitatively in line with the normative predictions of the model under standard assumptions. Yet, we also find evidence for reciprocal behavior. Our data analysis shows, however, that it does not pay for the employer to solely rely on the reciprocity of employees

On Notions of Security for Deterministic Encryption, and Efficient Constructions Without Random Oracles

The study of deterministic public-key encryption was initiated by Bellare et al. (CRYPTO ’07), who provided the “strongest possible” notion of security for this primitive (called PRIV) and constructions in the random oracle (RO) model. We focus on constructing efficient deterministic encryption schemes without random oracles. To do so, we propose a slightly weaker notion of security, saying that no partial information about encrypted messages should be leaked as long as each message is a-priori hard-to-guess given the others (while PRIV did not have the latter restriction). Nevertheless, we argue that this version seems adequate for many practical applications. We show equivalence of this definition to single-message and indistinguishability-based ones, which are easier to work with. Then we give general constructions of both chosen-plaintext (CPA) and chosen-ciphertext-attack (CCA) secure deterministic encryption schemes, as well as efficient instantiations of them under standard number-theoretic assumptions. Our constructions build on the recently-introduced framework of Peikert and Waters (STOC ’08) for constructing CCA-secure probabilistic encryption schemes, extending it to the deterministic-encryption setting as well

Experience with daptomycin daily dosing in ICU patients undergoing continuous renal replacement therapy

Purpose: For critically ill patients undergoing continuous renal replacement therapy (CRRT), daptomycin dosing recommendations are scarce. We, therefore, retrospectively assessed routinely measured daptomycin plasma concentrations, daptomycin dose administered and microbiological data in 11 critically ill patients with Gram-positive infections that had received daptomycin once daily. Methods: The retrospective analysis included critically ill patients treated at the intensive care unit (ICU) who had daptomycin plasma concentrations measured. Results: Daptomycin dose ranged from 3 to 8mg/kg/q24h in patients undergoing CRRT (n=7) and 6 to 10mg/kg/q24h in patients without CRRT (n=4). Peak and trough concentrations showed a high intra- and inter-patient variability in both groups, independent of the dosage per kg body weight. No drug accumulation was detected in CRRT patients with once-daily daptomycin dosing. Causative pathogens were Enterococcus faecium (n=6), coagulase-negative Staphylococcus (n=2), Staphylococcus aureus (n=2) and unknown in one patient. Microbiological eradication was successful in 8 of 11 patients. Two of three patients with unsuccessful microbiological eradication and fatal outcome had an Enterococcus faecium infection. Conclusion: In critically ill patients undergoing CRRT, daptomycin exposure with once-daily dosing was similar to ICU patients with normal renal function, but lower compared to healthy volunteers. Our data suggest that daptomycin once-daily dosing is appropriate in patients undergoing CRR