This paper examines the effects of incomplete information on dynamic investment and consumption in a general equilibrium model where shocks to capital are unobservable and there is structural or parameter uncertainty regarding the volatility of these shocks; i.e., the investment risk. In this...

This paper is about what is called usually SME (Small and medium-sized entreprises, thus including the very small companies). But it raises in preamble the question of the relevance, from an economic point of view, of this statistical category, defined, for example, like the companies employing...

This paper is concerned with those actions of business firms which are aimed at managing the business and economic risks and uncertainties. The standard example of risk management is finance and insurance but these only capture a small fraction of the business risk faced by a company in a...

We show that the increase in price riskiness reduces the optimal output under increasing absolute risk aversion. That is, the marginal impact of the risk on output is independent of the type of absolute risk aversion (decreasing, constant, or increasing)

This paper extends the existing estimation methods to allow estimation under simultaneous price and output uncertainty. In contrast with the previous literature, our approach is applicable to the direct and indirect utility functions and does not require specification and estimation of the...

We study the problem of multiple principals who want to obtain income from a privately informed agent and design their contracts non-cooperatively. Our analysis reveals that the degree of coordination between principals has strong implications for the shapes of contracts and the amount of...

The U.S. Bankruptcy code changed dramatically with the passage of The Bankruptcy Abuse Prevention and Consumer Protection Act Of 2005. This act increased the costs and decreased the benefits of bankruptcy to consumers. Supporters of the law claimed that it would benefit consumers as well as...

The paper examines why capital didn't flow from the rich to the poor. The problems identified are categorized in three broad categories: lack of complementary human capital, information asymmetries and transaction costs for small loan sizes. It explains how moneylenders solve the information...

A cybernetic perspective is used to evaluate firms with or without stakeholder participation in their information and control architecture. This approach also provides a basis for evaluating firms with more than one board or control center as found in Japan, Europe, and labor-managed firms....