Even (Mixed) Risk Lovers Are Prudent

The purpose of this note is to analyze properties of the risk lovers? utility function beyond the positive sign of its second order derivative. We show that??contrarily to a priori beliefs??risk lovers are prudent and are willing to accumulate precautionary savings.

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Year of publication:	2013
Authors:	Crainich, David ; Eeckhoudt, Louis ; Trannoy, Alain
Published in:	American Economic Review. - American Economic Association - AEA. - Vol. 103.2013, 4, p. 1529-35
Publisher:	American Economic Association - AEA

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Extent:	application/pdf
Type of publication:	Article
Notes:	DOI: 10.1257/aer.103.4.1529
Classification:	D81 - Criteria for Decision-Making under Risk and Uncertainty
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010666612