We formulate a robust theory of liquidity and risk management based on two fundamental frictions: 1) the entrepreneur … significant distortions for risk-sharing, corporate investment, and consumption. With regard to concern for ambiguity aversion …, the impacts of ambiguity on risk hedging is ambiguous due to the interactions between robustness and limited commitment …

We examine the impact on firm cash holdings of uncertainty of uncertainty, measured as the ex post volatility of …, we find that, when there is greater volatility of economic uncertainty, firms hold more cash. Our results are robust to … the possibility of a future desirability of investment. Therefore, when there is greater expected volatility of …

) and the General Theory (1936), as well as follow-ups in the postKeynesian approaches and others dealing with “fundamental …

-)variance of power plant profits. If investors are risk-averse, these differ- ences lead to divergent investment portfolios …, breaking the equivalence of price- and quantity-based policy instruments under risk-neutrality. Using the European power sector … with increasing risk aversion. …

) and the General Theory (1936), as well as follow-ups in the post-Keynesian approaches and others dealing with "fundamental …