Similar Search Results

Booms, Recessions and Financial Turmoil: A Fresh Look at Investment Decisions under Cyclical Uncertainty

Chen, Yu-Fu; Funke, Michael - CESifo - 2009

The paper studies the interaction between cyclical uncertainty and investment in a stochastic real option framework where demand shifts stochastically between three different states, each with different rates of drift and volatility. In our setting the shifts are governed by a three-state Markov...

Persistent link: https://www.econbiz.de/10005013955

The Behavioral Impact of Emotions in a Power-to-Take Game: An Experimental Study

Bosman, Ronald; Winden, Frans van - CESifo - 2000

The power-to-take game is a simple two player game where players are randomly divided into pairs consisting of a take authority and responder. Both players in each pair have earned an income in an individual real effort decision-making experiment preceding the take game. The game consists of two...

Persistent link: https://www.econbiz.de/10005181557

Explosive Oil Prices

Gronwald, Marc - CESifo - 2013

This paper deals with three aspects of spectacular oil price episodes such as the one witnessed in 2008. First, the concept of temporary explosiveness is proposed as an empirical method for capturing this type of behavior. The application of a recently proposed recursive unit root test shows...

Persistent link: https://www.econbiz.de/10010877773

Prices vs. Quantities with Endogenous Cost Structure

Storrøsten, Halvor Briseid - CESifo - 2014

Authorities often lack information for efficient regulation of the commons. This paper derives a criterion comparing prices versus tradable quantities in terms of expected welfare, given uncertainty, optimal policy and endogenous cost structure. I show that one cannot determine which regulatory...

Persistent link: https://www.econbiz.de/10010877871

Ambiguity Preferences and Portfolio Choices: Evidence from the Field.

Bianchi, Milo; Tallon, Jean-Marc - Centre d'Économie de la Sorbonne, Université Paris 1 … - 2014

We investigate the empirical relation between ambiguity aversion, risk aversion and portfolio choices. We match administrative panel data on portfolio choices with survey data on preferences over ambiguity and risk. We report three main findings. First, conditional on participation, ambiguity...

Persistent link: https://www.econbiz.de/10010942363

Aggregating Tastes, Beliefs, and Attitudes under Uncertainty.

Danan, Eric; Gajdos, Thibault; Hill, Brian; Tallon, … - Centre d'Économie de la Sorbonne, Université Paris 1 … - 2014

We provide possibility results on the aggregation of beliefs and tastes for Monotone, Bernoullian and Archimedian preferences of Cerreia-Vioglio, Ghirardato, Maccheroni, Marinacci and Siniscalchi (2011). We propose a new axiom, Unambiguous Pareto Dominance, which requires that if the unambiguous...

Persistent link: https://www.econbiz.de/10010942367

Once Upon a Time Preference - How Rationality and Risk Aversion Change the Rationale for Discounting

Traeger, Christian - CESifo - 2012

The paper develops an axiomatic framework for rational decision making. The von Neumann-Morgenstern axioms give rise to a richer risk attitude than that captured in the standard discounted expected utility model. I derive three models that permit a more comprehensive risk evaluation. These...

Persistent link: https://www.econbiz.de/10010544183

Why Uncertainty Matters - Discounting under Intertemporal Risk Aversion and Ambiguity

Traeger, Christian - CESifo - 2012

Uncertainty has an almost negligible impact on project value in the economic standard model. I show that a comprehensive evaluation of uncertainty and uncertainty attitude changes this picture fundamentally. The analysis relies on the discount rate, which is the crucial determinant in balancing...

Persistent link: https://www.econbiz.de/10009645646

Stay in School or Start Working? - The Human Capital Investment Decision under Uncertainty and Irreversibility

Bilkic, Natasa; Gries, Thomas; Pilichowski, Margarethe - CESifo - 2009

As the time of leaving school determines the level of academic achievement this timing decision is central for the human capital investment decision. Real option theory offers a new perspective of the human capital investment decision under uncertainty and irreversibility. Unlike other...

Persistent link: https://www.econbiz.de/10008596569

What is the Best Environmental Policy? Taxes, Permits and Rules under Economic and Environmental Uncertainty

Angelopoulos, Konstantinos; Economides, George; … - CESifo - 2010

We study the importance of uncertainty and public finance to the welfare ranking of three environmental policy … revenues finance public abatement. When the main source of uncertainty is economic, the most efficient recipe is to levy … pollution taxes and use the collected tax revenues to finance public abatement. However, when environmental uncertainty is the …

Persistent link: https://www.econbiz.de/10008596572