The informational content of the shape of utility functions: financial strategic behavior
β Scribed by Joost M.E. Pennings; Philip Garcia
- Publisher
- John Wiley and Sons
- Year
- 2009
- Tongue
- English
- Weight
- 122 KB
- Volume
- 30
- Category
- Article
- ISSN
- 0143-6570
- DOI
- 10.1002/mde.1439
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β¦ Synopsis
Abstract
Recently, Pennings and Smidts (2003) showed a relationship between organizational behavior and the global shape of the utility function. Their results suggest that the shape of the utility function may be related to βhigherβorderβ decisions. This research examines the relationship between financial strategic decisions and the global shape of the utility function of real decision makers. We assess the shape of utility functions of portfolio managers and show that the global shape is related to their strategic asset allocation. The findings demonstrate the informational content of the shape of utility functions in the context of financial strategic behavior. Copyright Β© 2008 John Wiley & Sons, Ltd.
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