based on introducing stochastic idiosyncratic cash flow risk into an equity valuation model of firms with growth options …. Within our model, a firm's systematic risk depends on the delta of its growth option. The growth option's delta is lower when … idiosyncratic volatility rises, driving down the firm's systematic risk and hence its expected return - firms with higher …

This study examines risk premia in a laboratory market featuring a long-lived asset. The research is enabled by …, statistically significant risk premia are reported, in support of standard asset pricing models. Potential determinants of the risk … premia are investigated. These risk premia are not sensitive to expected variance, but do vary positively with the magnitude …

bubbles. We consider a setting where participants sorted according to their degree of risk aversion trade in experimental … asset markets. We show that risk sorting is able to explain bubbles partially: Markets with the most risk-tolerant traders … exhibit larger bubbles than markets with the most risk averse traders. In our study risk aversion does not correlate with …

valuation uncertainty stocks. Stocks in the short leg earn average returns indistinguishable from the risk-free rate – turning …

savings behavior. Based on a buffer stock savings model, three treatment dimensions are used: The amount of information … subjects receive about the likelihood of income shocks, whether subjects are informed about other people‘s beliefs about these … the income shock – consumption decisions are surprisingly close to the optimal consumption path. If at all, more …

In this experimental study of tax evasion and its determinants participants earn their income in a complex stochastic … intertemporal environment including the possibility to invest into a risky asset. The earned income has to be declared in four tax … donated to charity organizations. Our main results show that higher income induces tax fraud and that gender differences exist. …