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Risk and Risk Aversion Effects in Contests with Contingent Payments
(Private Enterprise Research Center, Texas A&M University, 2018-01-18)
Firms seeking new products, investors backing competitors, and government agencies in search of design solutions are all examples of different models of contest design found in the marketplace. In PERC’s working paper ...
The Probability Premium Approach to Comparative Risk Aversion
(Private Enterprise Research Center, Texas A&M University, 2015-04-23)
In the framework of expected utility, nth-degree risk aversion/loving is unequivocally characterized by the sign of the nth-order derivative of the utility function, but there exist different notions of one decision maker ...
Tradeoffs for Downside Risk-Averse Decision-Makers and the Self-Protection Decision
(Private Enterprise Research Center, Texas A&M University, 2015-09-01)
Agents who are averse to increases in downside risk are defined as being averse to changes that shift a certain amount of risk to a lower income level. For downside risk averse decision makers, there are several tradeoffs ...