Crainich, David; Eeckhoudt, Louis; Courtois, Olivier Le - IÉSEG School of Management, Université Catholique de Lille - 2013
To analyze the impact of background risks, decreasing absolute risk aversion (DARA) must be combined with other … vulnerability can also be associated with the sole assumption of decreasing downside risk aversion (DDRA). That is, no matter how … absolute risk aversion changes with wealth, DDDRA in the Arrow-Pratt sense and DDRA in the Ross sense are shown to be …