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Prospect theory and hedging risks
Broll, Udo; Egozcue, Martín; Wong, Wing-Keung; … - 2010
The prospect theory is one of the most popular decision-making theories. It is based on the S-shaped utility function …, unlike the von Neumann and Morgenstern (NM) theory, which is based on the concave utility function. The S-shape brings in … mathematical challenges: simple extensions and generalizations of NM theory into the prospect theory cannot be frequently achieved …
Persistent link: https://www.econbiz.de/10010301357
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The firm under uncertainty: capital structure and background risk
Broll, Udo; Wong, Keith K.P. - 2010
This paper examines the interplay between the real and financial decisions of the competitive firm under output price uncertainty. The firm faces additional sources of uncertainty that are aggregated into a background risk. We show that the firm always chooses its optimal debt-equity ratio to...
Persistent link: https://www.econbiz.de/10010301363
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Nachfrageunsicherheit und Risikopolitik im Duopol
Broll, Udo; Pelster, Matthias; Wahl, Jack E. - 2012
Die vorliegende Arbeit untersucht ein Duopol bei unsicherer Nachfrage unter Risikoaversion. Die Produktion der gesamten Industrie fällt durch die Einführung von Nachfrageunsicherheit; der Marktpreis steigt wegen des schwächeren Wettbewerbs. Damit ist die Veränderung des Gewinns und des...
Persistent link: https://www.econbiz.de/10010309621
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Regional investment under uncertain costs of location
Broll, Udo; Roldán-Ponce, Antonio; Wahl, Jack E. - 2012
Due to globalization competitive firms face increasing economic opportunities for locating their activities in countries, regions and cities that provide the best business environment for their specific needs. In our study we focus on the impact of economic risk and risk preferences upon...
Persistent link: https://www.econbiz.de/10010308305