Homeland security against possible terrorist attacks involves making decisions under true uncertainty. Not only are we ignorant of the form, place, and time of potential terrorist attacks, we are also largely ignorant of the likelihood of these attacks. In this paper, we conceptualize homeland...

This paper explores the productivity and income distribution effects of asymmetric information and risk preferences on the credit market. A model of contract design in the presence of moral hazard is developed in which competitive, risk neutral lenders offer contracts to risk averse agents who...

This paper presents a model that endogenizes asset-based risk- coping in an environment of unmediated risk and subsistence constraints. It uses an individually-rational, stochastic dynamic programming model to explore intertemporal portfolio decisions in an environment in which both yield risk...

In this paper, a two-period game is constructed, where duopoly firms choose advertising strategies in the first period and compete in price or quantity in the second period by maximizing the value of firm equity. Using certainty equivalence, we demonstrate the impacts of uncertainty and modes of...

This paper aimed to analyse the BM&F cattle future market as a tool for price riskmanagement for traders that deal cattle in the Rondônia State. In order to reach this goal itwas analysed if there is a long-term relationship between the cattle prices in Rondônia and theEsalq/BM&F Cattle Index....

We theoretically examine a farmer’s coverage demand with area and individual insurance plans as either separate or integrated options. The individual and area losses are assumed to be imperfectly and positively correlated. With actuarially fair rates, the farmer will fully insure with the...

We theoretically examine a farmer’s coverage demand with area and individual insurance plans as either separate or integrated options. The individual and area losses are assumed to be imperfectly and positively correlated. With actuarially fair rates, the farmer will fully insure with the...

Production costs for fresh Atlantic groundfish and scallop processing are examined using direct observation, linear regression analysis, and cost accounting. Assuming that management chooses a production technique where marginal costs are constant over a wide range of production due to...

There is a wide variety of regulatory instruments available for achieving economic efficiency in markets where externalities exist. All of them, when correctly designed,are equally effective, provided that complete information is available and that adjustments to the level of the instrumentscan...

We develop a model of regulation of environmental risks in a heterogeneousindustry when policy makers are sensitive to uncertainties about the processes generating the risks. Optimal source reduction capacity is shown to vary according to site suitability. Optimal source reduction capacity and...