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Uncertainty over uncertainty in environmental policy adoption : Bayesian larning of unpredictable socioeconomic costs

Basei, Matteo; Ferrari, Giorgio; Rodosthenous, Neofytos - 2023

The socioeconomic impact of pollution naturally comes with uncertainty due to, e.g., current new technological developments in emissions' abatement or demographic changes. On top of that, the trend of the future costs of the environmental damage is unknown: Will global warming dominate or...

Persistent link: https://www.econbiz.de/10014277005

Belief-neutral efficiency in financial markets

Beißner, Patrick; Riedel, Frank - 2025

Heterogeneous beliefs among market participants can lead to questionable speculative trading that goes beyond any risk … pricing for ambiguous contracts, without compromising legitimate risk-hedging activities. While Arrow-Debreu equilibria …

Persistent link: https://www.econbiz.de/10015272951

Political uncertainty of impeachment upon corporate investment decisions

Jucá, Michele Nascimento; Fishlow, Albert - In: Borsa Istanbul Review 21 (2021) 2, pp. 149-160

This study aims to verify if there is a negative relation between the investment of Brazilian companies and the …

Persistent link: https://www.econbiz.de/10012816606

Economic risk of wind farm investments in UAE : evaluation through real options approach

Sisodia, Gyanendra Singh; Al Mazrouei, Wafa Mohammed Ebrahim - In: International Journal of Energy Economics and Policy : IJEEP 13 (2023) 5, pp. 658-666

Persistent link: https://www.econbiz.de/10014384645

De and re-levering betas with risky debt

Krause, Marko Volker - In: Business research 12 (2019) 2, pp. 703-720

-levering procedure is around for the case of risk-free debt. The procedure for risky debt is much less clear even under very simplifying …

Persistent link: https://www.econbiz.de/10012256377

On the valuation and analysis of risky debt : a practical approach using rating migrations

Fischer, Edwin O.; Kampl, Lisa-Maria; Wöckl, Ines - In: Credit and capital markets : Kredit und Kapital 56 (2023) 3/4, pp. 287-312

payments subject to default risk. We use a discrete risk-neutral present value model with expected payments for risk …-neutral investors and risk-free spot rates for the valuation. The expected payments include the potentiality of default by weighting … promised payments the risk-neutral default probabilities. The required risk-neutral default probabilities are derived from …

Persistent link: https://www.econbiz.de/10015188164

Economic policy uncertainty and overinvestment: evidence from Korea

Jiang, Wenwen; Kim, Hwa-sung - In: Journal of derivatives and quantitative studies : … 29 (2021) 4, pp. 301-318

The authors show that there is a negative relationship between economic policy uncertainty (EPU) and firm overinvestment using Korean data from 2007 to 2016. Since Jensen (1986) shows that a firm's free cash flow is an important factor of overinvestment, the authors examine how free cash flow...

Persistent link: https://www.econbiz.de/10012658770

Comparison of the production behavior of regret-averse and purely risk-averse firms

Guo, Xu; Wong, Wing Keung - In: Estudios de economía 46 (2019) 2, pp. 157-171

firms under certainty. This paper extends the theory by further investigating the effects of regret-aversion on production …. We compare the optimal output levels of regret-averse firms with purely risk- averse firms under uncertainty and firms … under certainty. We first show that the linear-regret firms will surely produce more than their purely risk …

Persistent link: https://www.econbiz.de/10012268101

Expectations concordance and stock market volatility : Knightian uncertainty in the year of the pandemic

Frydman, Roman; Mangee, Nicholas - In: Journal of risk and financial management : JRFM 14 (2021) 11, pp. 1-13

This study introduces a novel index based on expectations concordance for explaining stock-price volatility when novel events that are each somewhat unique cause unforeseeable change and Knightian uncertainty in the process driving outcomes. Expectations concordance measures the degree to which...

Persistent link: https://www.econbiz.de/10012795039

Financial ambiguity and oil prices

Ayoub, Mahmoud; Qadan, Mahmoud - In: Financial innovation : FIN 10 (2024), pp. 1-23

Recent theoretical developments in economics distinguish between risk and ambiguity (Knightian uncertainty). Using …

Persistent link: https://www.econbiz.de/10015361650