In diesem Diskussionspapier werden die Ergebnisse einer im Mai/Juni 2007 durchgeführten Unternehmensbefragung im Raum Niedersachsen vorgestellt in Bezug auf die Fragestellung, ob sich Unternehmen, die Innovationsförderung erhalten, von nicht geförderten Unternehmen in Bezug auf generelle...

We develop a continuous-time dynamic contracting model where a risk-neutral principal hires a risk-averse agent to manage a project. The project risk is controlled by the principal or agent, and there is a trade-off between risk premium and a value-destroying effect of risk. No-saving selection...

Many disasters are foreshadowed by insufficient preventative care. In this paper, we argue that there is a true problem of prevention, in that insufficient care is often the result of rational calculations on the part of agents. We identify three factors that lead to dubious efforts in care....

This textbook incorporates the author's previous book "The Economics of Uncertainty and Insurance" and extends it with the addition of several new chapters on risk sharing, asymmetric information, adverse selection, signaling and moral hazard. It provides a comprehensive introduction to the...

An issuer, privately informed about the distribution of the project's cash flows, raises financing from an uninformed investor through a security sale. The investor faces Knightian uncertainty about the distribution of cash flows and evaluates each security by the worst-case distribution at...

We develop a tractable model to study jointly the role of non-diversifiable risk and financial frictions for business cycles. Non-diversifiable risk induces strong precautionary motives, which reduce the exposure of entrepreneurs to aggregate disturbances ex-ante, and make it easier to increase...

I investigate the decision problem of a player in a game of incomplete information who faces uncertainty about the other players' strategies. I propose a new decision criterion which works in two steps. First, I assume common knowledge of rationality and eliminate all strategies which are not...

This paper studies a robust version of the classic surplus extraction problem, in which the designer knows only that the beliefs of each type belong to some set, and designs mechanisms that are suitable for all possible beliefs in that set. We derive necessary and sufficient conditions for full...

The "quant crisis" of 2007 and subsequent unfolding of the global financial crisis highlighted the importance of the "crowded-trade" problem (not being able to know how many others are taking the same position). To investigate the crowded trading, we present a model in which informed and...

I use a forward-looking and exogenous measure of price uncertainty to examine the causative effect of uncertainty on the choice and use of financial covenants in private and public debt contracts, as well as the role that risk management and financial frictions play in that relationship. In...