organizations, most notably risk-shifting and the quiet life …

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. …

introducing a new structural approach: deep replication. With this method, we extract the risk aversion of S&P500 options per … contract and per day. Cross-sectionally, we show the existence of a risk aversion smile reminiscent of the Black …-Scholes volatility smile. Across time, we measure a change following 2008, with put options exhibiting a higher average risk aversion …

setting with moral hazard and risk-averse agents who have private information on their ability. Two heterogenous firms …, high-ability agents are over-incentivized and bear too much risk. For a range of intermediate degrees of competition …

may be tempted to engage in excessively risky activities, such as reducing maintenance expenditures (at the risk of … provoking a break-down of the system) or in speculation (at the risk of incurring massive losses it cannot bear). These risky …