Falato, Antonio - Federal Reserve Board (Board of Governors of the … - 2008
psychology �ndings see Isen (1999) and Appen-
dix A). While earlier studies indicate a tendency toward conservatism for …+1 = + t+1 (12)
Investor preference parameters, ( ; ; t); are chosen based on evidence from �eld studies
and the … Prescott (1985) deems reasonable risk aversion coe� cients
within the (0;10) interval. Field studies support this choice, since …