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Decision making in incomplete markets with ambiguity : a case study of a gas field acquisition

Zhao, Lin; Wijnbergen, Sweder van - 2014

We apply utility indifference pricing to solve a contingent claim problem, valuing a connected pair of gas fields where the underlying process is not standard Geometric Brownian motion and the assumption of complete markets is not fulfilled. First, empirical data are often characterized by...

Persistent link: https://www.econbiz.de/10010465169

Starting an R&D project under uncertainty

Dobbelaere, Sabien; Luttens, Roland Iwan; Peters, Bettina - 2010

We study a two-stage R&D project with an abandonment option. Two types of uncertainty influence the decision to start R …&D. Demand uncertainty is modelled as a lottery between a proportional increase and decrease in demand. Technical uncertainty is … modelled as a lottery between a decrease and increase in the cost to continue R&D. We relate differences in uncertainty to …

Persistent link: https://www.econbiz.de/10011378299

Deal or no deal? : decision-making under risk in a large-payoff game show

Post, Thierry; Baltussen, Guido; Assem, Martijn J. van den - 2006

We examine the risky choices of contestants in the popular TV game show “Deal or No Deal” and related classroom experiments. Contrary to the traditional view of expected utility theory, the choices can be explained in large part by previous outcomes experienced during the game. Risk aversion...

Persistent link: https://www.econbiz.de/10011348343

Risk aversion under preference uncertainty

Kräussl, Roman; Lucas, André; Siegmann, Adriaan Hendrik - 2010

their risk aversion parameter invest less in risky assets than wealthy investors with identical risk aversion uncertainty. …

Persistent link: https://www.econbiz.de/10011382430

Educational choice, initial wage and wage growth

Mazza, Jacopo; Ophem, Hans van - 2020

We investigate the major choice of college graduates where we make choice dependent on expected initial wages and expected wage growth per major. We build a model that allows us to estimate these factors semiparametrically and that corrects for selection bias. We estimate the model on the...

Persistent link: https://www.econbiz.de/10012228687

Poverty and uncertainty attitudes

Gonzalez Jimenez, Victor H. - 2024

This paper demonstrates that well-established biases in decision making under uncertainty can generate poverty traps. A …

Persistent link: https://www.econbiz.de/10015062969

Bayesian D-optimal choice designs for mixtures

Ruseckaite, Aiste; Goos, Peter; Fok, Dennis - 2014

Consumer products and services can often be described as mixtures of ingredients. Examples are the mixture of ingredients in a cocktail and the mixture of different components of waiting time (e.g., in-vehicle and out-of-vehicle travel time) in a transportation setting. Choice experiments may...

Persistent link: https://www.econbiz.de/10010350005

HIV/AIDS, risk aversion and intertemporal choice

Lammers, Judith; Wijnbergen, Sweder van - 2008 - Rev.

This study analyses the relation between perceived health status and intertemporal choice. We use data from experiments with real monetary rewards conduEted among students in South Africa to estimate risk and time preferences. These experimental data, based on muitiple price lists developed by...

Persistent link: https://www.econbiz.de/10011373818

Investment, resolution of risk, and the role of affect

Winden, Frans A. A. M. van; Krawczyk, Michal; … - 2008

This experimental study is concerned with the impact of the timing of the resolution of risk onpeople's willingness to take risks, with a special focus on the role of affect. While the importanceof anticipatory emotions has so far been only inferred from decisions regarding hypothetical...

Persistent link: https://www.econbiz.de/10011374397

Separating real incentives and accountability

Vieider, Ferdinand M. - 2008

In experimental investigations of the effect of real incentives, accountability-the implicit or explicit expectation of a decision maker that she may have to justify her decisions in front of somebody else-is often confounded with the incentives themselves. This confounding of accountability...

Persistent link: https://www.econbiz.de/10011376460