Crainich, David; Eeckhoudt, Louis; Courtois, Olivier Le - IÉSEG School of Management, Université Catholique de Lille - 2013
To analyze the impact of background risks, decreasing absolute risk aversion (DARA) must be combined with other restrictions on the shape of the utility function in order to make preferences risk vulnerable. In this note, we indicate that risk vulnerability can also be associated with the sole...