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Strategic risk aversion

Date

Authors

Shaffer, Sherrill

Publisher

Routledge, Taylor & Francis Group

Abstract

This article demonstrates that exaggerated risk aversion may comprise a rational form of strategic behaviour in the face of asymmetric information. Unlike some other forms of strategic behaviour analysed previously, this behaviour confers a benefit in the form of higher ex post consumption (not merely higher expected consumption or expected utility) and whether or not markets are perfectly competitive.

Keywords

Keywords: asymmetric information; competition (economics); consumption behavior; market conditions; risk factor Asymmetric information; Contingent claims; Risk aversion; Strategic behaviour

URI

http://hdl.handle.net/1885/55509

Collections

ANU Research Publications

Source

Applied Financial Economics

Type

Journal article

DOI

10.1080/09603107.2011.556587

Restricted until

2037-12-31

Downloads

File

Description

01_Shaffer_Strategic_risk_aversio_2011.pdf (151.38 KB)

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