We apply the mean-standard deviation paradigm to examine a widely used model of the hedging literature. As the hedging model satisfies a scale and location condition the mean-standard deviation technique provides more intuition for the revision of the firm's optimum risk taking when price...

Some theoretical crisis models of third generation incorporate the "balance sheet effect" emphasized by Bernanke and Gertler (1989) and many papers since. In a crisis context this mechanism, based on asymmetric information in the credit market, describes how a currency depreciation affects...

Some theoretical crisis models of third generation incorporate the "balance sheet effect" emphasized by Bernanke and Gertler (1989) and many papers since. In a crisis context this mechanism, based on asymmetric information in the credit market, describes how a currency depreciation affects...

This paper presents a stochastic approach to the theory of aggregateproduction function, based on the theory of stochastic differentialequations. The main result is that under certain restrictions the productionfunction converges from below to the Cobb-Douglas functionproviding further support...

We show that Stiglitz's (1974) principal-agency theory of share tenancy does not imply, as alleged, that the optimal tenant share is less than one for risk-averse tenants nor that the share decreases monotonically with tenant risk aversion. Tenants may self insure by working harder increasingly...

A multi-product cost function is evaluated for the universities of Spain, using a random parameters stochastic frontier model. This allows estimates of systematic cost differences to be obtained alongside estimates of universities' efficiency. In addition, we evaluate average incremental costs...

Increasing divisional operational responsibilities and the dispersal of knowledge creating activities within the firm have loosened the traditional hierarchical structure of multi-divisional firms. In this paper we argue that a similar mixture of competition and cooperation that is found in...

Standard economic theory assumes individuals choose actions that optimize their expected utility. In this paper we investigate how the existence of players with non-standard preferences may influence economic agents' behavior in some of the most frequently studied non-cooperative games. We find...

This paper shows that the available stylized facts on productivity dynamics, such as persistent cross-sectoral heterogeneity, do not allow to solve an identification problem regarding the impact of common drivers - such as General Purpose Technologies (GPTs) - on economic growth. The evidence of...

We present a model of optimal monitoring expenditures. For any technology that yields a conventional ``S-shaped''' production function for monitoring, the optimal level of monitoring is shown to be higher in medium-sized firms than in both small and large firms. Further, the interaction between...