A theoretical model of firm growth under uncertaintyis developed in order to account for the high failure rate of young firms. Thismodel pulls together several strands of the existing literature, including: theportfolio approach to balancing risk and return; a variation on Gibrant's lawas a...

We propose a new framework for pricing assets, derived in part from the traditional consumption-based approach, but which also incorporates two long-standing ideas in psychology: prospect theory, and evidence on how prior outcomes affect risky choice. Consistent with prospect theory, the...

We propose a new framework for pricing assets, derived in part from the traditional consumption-based approach, but which also incorporates two long-standing ideas in psychology: prospect theory, and evidence on how prior outcomes affect risky choice. Consistent with prospect theory, the...