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We address the paradox that financial innovations aimed at risk-sharing appear to have made the world riskier. Financial innovations facilitate hedging idiosyncratic risks among agents; however, aggregate risks can be hedged only with liquid assets. When risk-sharing is primitive, agents...
Persistent link: https://www.econbiz.de/10012611389
“El sector asegurador es un importante generador de recursos de ahorro institucional que ha promovido el desarrollo del mercado de capitales alrededor del mundo y ha canalizado inversión hacia los sectores industrial, financiero y constructor principalmente. En Colombia hasta la década de...
Persistent link: https://www.econbiz.de/10011265493
Mathematical Finance at the Econometric Institute at the Erasmus University in Rotterdam. His research interests focus on pricing … models for interest rate derivatives, the pricing of insurance contracts and Asset-Liability Management of insurance …
Persistent link: https://www.econbiz.de/10010837406
This paper examines the choice of tools for managing a firm’s operational risks: cash reserves, insurance contracts, and financial assets under an optimal financing contract that solves moral hazard between insiders and outside investors. Risk management is valuable as it reduces the costs of...
Persistent link: https://www.econbiz.de/10010842923
This paper presents a model that measures the impact of political risk on portfolio investment when the political risks are multivariate and correlated across countries. The multivariate approach generalizes the single country model but retains most of its characteristics in terms of its ability...
Persistent link: https://www.econbiz.de/10010937104
This paper examines the choice of tools for managing a firm’s operational risks: cash reserves, insurance contracts, and financial assets under an optimal financing contract that solves moral hazard between insiders and outside investors. Risk management is valuable as it reduces the costs of...
Persistent link: https://www.econbiz.de/10010745872
BRICS (Brazil, Russia, India, China and South Africa) are viewed currently as pillars of relative political, economic and financial stability, with the prospect of a major shift in future world power. The paper aims at investigating the relationships among the economic, financial and political...
Persistent link: https://www.econbiz.de/10010751799
The current financial crisis had an important impact on economies all over the world. Romania – one of the Eastern European countries, considered just one year ago to have a good growth potential – is also absorbing the shock waves of this crisis. As expected, the first to respond to those...
Persistent link: https://www.econbiz.de/10004961197
We characterize a firm as a nexus of activities and projects with their associated cashflows. Production and operations activities and real risk management activities distribute cashflows over states of nature and time periods, leading to a transformation possibility frontier similar to a...
Persistent link: https://www.econbiz.de/10005100941
-wide hurdle rate is inconsistent with the standard theory of financial valuation. We use asset pricing theory to determine the …
Persistent link: https://www.econbiz.de/10008509435