Spanish authorities have recently approved a new legislative framework for the creation of local water markets to improve allocative efficiency for this scarce resource. This paper analyses the potential impacts of the policy. A utility function for three groups of farmers was elicited, using a...

This paper re-examines the link between absolute prudence and self-protection activities. We show that the level of effort chosen by an agent with positive and decreasing absolute prudence is larger than the optimal effort chosen by a risk-neutral agent if the degree of absolute prudence is less...