these instruments in the banking in- dustry which is heavily exposed to credit risk. However, while recent literature mainly …

. 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 …-averse firms to produce more than the purely risk-averse counterparts and study the comparative statics of the optimal production …

One of the standard predictions of the agency theory is that more incentives can be given to agents with lower risk … obtain that lower agent's risk aversion unambiguously leads to higher incentives when the technology function linking … efficiency and riskiness is elastic, while the risk aversion-incentive relationship can be positive when this function is rigid. …

firms optimal production and exporting decisions. The firms elasticity of risk aversion determines the direction of the … impact of exchange rate risk on exports. Based on a flexible utility function that incorporates all possible risk preferences …, a unique structurally estimable equation is used to estimate the risk aversion elasticities for a panel of Indian …

uncertainty. The firm faces additional sources of uncertainty that are aggregated into a background risk. We show that the firm … always chooses its optimal debt-equity ratio to minimize the weighted average cost of capital, irrespective of the risk …. When the background risk is either additive or multiplicative, we provide reasonable restrictions on the firm's preferences …

differences in risk premia. We deduct testable hypotheses on the basis of which we empirically analyze the impact of uncertainty …

approach, and unsophisticated banks, eligible for the standardized approach, allocate their loan portfolio between high-risk … risk-taking, but encourage unsophisticated banks to increase risk-taking. The risk reallocation effects are stronger when …