experiment to measure risk attitudes. We find robust evidence of substantial risk aversion. As an extension, we esimate the … various models using transformations of the ‘true’ probabilities to decision weights. The estimated degree of risk aversion … increases further, while players tend to overestimate substantially their chances of winning. Constant Relative Risk Aversion …

which the objectives of managers and entrepreneurs in choosing the risk composition of their firms' returns are not aligned … managers and entrepreneurs to unhedgeable firm-specific risk, induces them to change the stochastic properties of firm cash … flows. Since they can trade in markets for aggregate risk but not for firm-specific risk, managers and entrepreneurs produce …

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. …

their growth. Economic theory suggests uncertainty can cause firms to delay investments until uncertainty is resolved. We … that, contrary to what they profess, macroeconomic and political risk is not inhibiting the investment behavior of …

We study risk taking on behalf of others in an experiment on a large random sample. The decision makers in our … experiment are facing high-powered incentives to increase the risk on behalf of others through hedged compensation contracts or … respond strongly to these incentives that result in an increased risk exposure of others. However, we find that the increase …

Despite much work on hedging in incomplete markets, the literature still lacks tractable dynamic hedges in plausible … hedger, guided by the traditional minimum-variance criterion, aims at reducing the risk of a non-tradable asset or a … generalized "Greeks," familiar in risk management applications, as well as retaining the intuitive features of their static …

averse to risk and ambiguity. The evidence is largely correlational, however, leaving open the question of the direction of … causality. In this paper, we present experimental evidence of causation running from reliance on intuition to risk and ambiguity … lowers the probability of being ambiguity averse by 30 percentage points and increases risk tolerance by about 30 percent in …