This paper examines the behavior of the competitive firm under correlated price and background risk when a futures … market exists for hedging purposes. We show that imposing the background risk, be it additive or multiplicative, on the firm … has no effect on the separation theorem. The full-hedging theorem, however, holds if the background risk is independent of …

It is well known that risk increases the value of options. This paper makes that precise in a new way. The conventional …

Building on previous studies on perceptions of inequality, welfare and risk we investigate the structure of individuals …' rankings of uncertain prospects in terms of risk and their relationship to individual preferences. We examine three interlinked … propositions that are fundamental to the standard economic approach to risk: (i) that rankings by risk are simply the reverse of …

Building on previous studies on perceptions of inequality, welfare and risk we investigate the structure of individuals …' rankings of uncertain prospects in terms of risk and their relationship to individual preferences. We examine three interlinked … propositions that are fundamental to the standard economic approach to risk: (i) that rankings by risk are simply the reverse of …

The article presents the initial proposal for the group risk measurement based on the comparison of two interconnected … sets of webs. The risk scalar has been presented both for each separated subsidiary as well as for the group itself. It was … shown the risk profile of the group could be aggregated into a single value, and some consequences of that attribute was …

depending upon the relative risk aversion of agents, the social discount rate and the marginal arrival rate of innovations …

introduced in the literature. This gives rise to a unified approach and extension of some definitions of increasing risk …

unbounded probability distributions. We also consider the related notion of increasing risk about $\nu$ introduced by …