This paper extends the median voter model to include risk aversion. An expected utility maximizing median voter with an aversion to risk may behave differently than a median voter who is certain. A referendum on income redistribution from the top of the distribution to the bottom which fails when th
Regulating a risk-averse firm under incomplete information
โ Scribed by Chifeng Dai
- Publisher
- Springer US
- Year
- 2008
- Tongue
- English
- Weight
- 158 KB
- Volume
- 34
- Category
- Article
- ISSN
- 0922-680X
No coin nor oath required. For personal study only.
๐ SIMILAR VOLUMES
## Abstract The valuation of the firm and its assets has been done for a long time in the classic context of complete information. Several empirical tests of the main valuation methods reveal a divergence between theoretical prices and observed prices. These deviations might be explained by the sta
We develop a model of firm behavior in the presence of risk, resource constraints, and a cash flow constraint. Given imperfect capital markets, the producer confronts an uncertain cash flow. Utilizing chance constrained programming, we show that an increase in aversion to liquidity risk can cause an