Recent empirical work suggests a strong connection between the incentives money managers are offered and their risk … not only effort exertion but also risk taking behavior. The moral hazard problem with risk taking involves an incentive …-compatibility constraint on risk, which we characterize. We distinguish between one period and several periods. In the former case, under mild …

choice of performance measures and incentives depends on the agent’s knowledge, environmental risk, technological uncertainty …

Central and Eastern Europe. The theoretical section establishes a link between a risk-averse investor’s amount of information … faces less risk; therefore, the investor’s risk premium falls and the investor’s bid rises. This link generates four …

In this article, we develop and estimate an econometric panel data model to capture the common dynamics in dollar risk … premia in various forward foreign exchange rates. The common component in the dollar risk premia is highly significant and …-related common component. Our evidence also suggests that the three different foreign currencies’ dollar risk premia ‘respond’ to the …

This paper provides a critical survey of the methods employed to model the effects of risk in econometric models. Most … procedure used in the paper is to directly estimate the conditional variance (risk) by non-parametric estimators. Applications … are made to foreign exchange markets, interest rates and unemployment/inflation risk relations. …

to farmer investment is uninsured risk: when provided with insurance against the primary catastrophic risk they face … basis risk associated with the index insurance, and with imperfect trust that promised payouts will be delivered. …

consumers, an upstream firm posts public bilateral contracts. When downstream firms are risk-neutral without wealth constraints …, the upstream firm offers the input to all retailers. When they are sufficiently risk averse it sells to one, thereby … eliminating externalities among downstream firms that necessitate the payment of risk premia. By similar reasoning exclusion is …

The paper analyses the transmission of liquidity shocks and risk shocks to global financial markets. Using a Global VAR … strong during the 2010-11 sovereign debt crisis, with risk shocks driving down bond yields in key advanced economies. The …

that, contrary to what they profess, macroeconomic and political risk is not inhibiting the investment behavior of …