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The competitive firm under price uncertainty : the role of information and hedging
Broll, Udo; Eckwert, Bernhard - In: Decisions in economics and finance : DEF ; a journal of … 31 (2008) 1, pp. 1-11
Persistent link: https://www.econbiz.de/10003771578
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Modelling information and hedging : the exporting firm
Broll, Udo; Eckwert, Bernhard - In: Economic modelling 26 (2009) 5, pp. 974-977
Persistent link: https://www.econbiz.de/10003871240
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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/10003971039
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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/10003980000
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The competitive firm under price uncertainty : the role of information and hedging
Broll, Udo (contributor); Eckwert, Bernhardt (contributor) - 2007
We study the impact of transparency in a commodity market on the decision problem of a competitive firm under price uncertainty and hedging opportunities. Market transparency is modeled by means of the informational content of publicly observable signals which are correlated with the random...
Persistent link: https://www.econbiz.de/10003581734
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Information value, export and hedging
Broll, Udo; Eckwert, Bernhard - 2011
The paper analyzes the interactions between the precision of information, trade and welfare within a decision framework of an exporting firm. Information in a financial market is described in terms of a publicly observable signal. With higher transparency, the signal conveys more precise...
Persistent link: https://www.econbiz.de/10009228937
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International trade and the role of market transparency
Broll, Udo; Eckwert, Bernhard; Kit, Pong Wong - 2010
The paper examines the economic role of market transparency on the decision problems of an international firm. Transparency is described in terms of the informativeness of a publicly observable signal. With higher transparency, the signal conveys more precise information about the random foreign...
Persistent link: https://www.econbiz.de/10009229027
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Transparency in the banking sector
Broll, Udo; Eckwert, Bernhard; Eickhoff, Andreas - 2011
The paper revisits the impact of uncertainty on the decision problem of a bank. The bank extends risky loans to private investors and sells deposits to savers at fixed rates. The uncertainty under which deposit/loan-portfolios are chosen by banks is endogenized through an information system that...
Persistent link: https://www.econbiz.de/10009425842
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Ambiguity and the incentive to export
Broll, Udo; Kit, Pong Wong - 2014
This paper examines the optimal production and export decisions of an international firm facing exchange rate uncertainty when the firm's preferences exhibit smooth ambiguity aversion. Ambiguity is modeled by a second-order probability distribution that captures the firm's uncertainty about...
Persistent link: https://www.econbiz.de/10011521686
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Multinational firm, exchange rate risk and the impact of regret on trade
Broll, Udo; Welzel, Peter; Kit, Pong Wong - 2014
This paper examines the behavior of the regret-averse multinational firm under exchange rate uncertainty. The multinational firm simultaneously sells in the home market and exports to a foreign country. We characterize the multinational firm's regret-averse preferences by a modified utility...
Persistent link: https://www.econbiz.de/10011521733