When estimates of variances are used to make asset allocation decisions, underestimates of population variances lead to lower expected utility than equivalent overestimates: a utility based criterion is asymmetric, unlike standard criteria such as mean squared error. To illustrate how to...

When estimates of variances are used to make asset allocation decisions, underestimates of population variances lead to lower expected utility than equivalent overestimates: a utility based criterion is asymmetric, unlike standard criteria such as mean squared error. To illustrate how to...

This paper focuses on the endogeneity of the investment-to-GDP ratio and the population growth rate, two of the most frequently used control variables in cross-country growth regressions for the convergence test. The Summers-Heston data (1988) show that the former rises and the latter declines...