The industrialized world experiences a demographic shift that is straining public pension systems. Employer-sponsored pension plans change from defined benefit to defined contribution. More emphasis is put on individually managed retirement funds. One concern with this movement is the potential...

Insurance guarantee schemes (IGSs) aim to protect policyholders from the costs of insurer insolvencies. However, IGSs can also reduce the incentives of insurers to conduct appropriate risk management. We investigate the risk-taking behavior of a stock insurer under insurance guarantee schemes...

This paper investigates the question of how risk management should be embedded in a financial firm's hierarchy. We take an innovative approach to answering this question by combining capital market theory with game-theoretic thinking. We develop a theory for the integration of risk management --...

Lack of transparency in securitization transactions contributed significantly to the severe financial crisis of 2007-2009. In this paper, based on a recent idea by Markowitz (2009), we propose an incentive-compatible mechanism for future securitization transactions that will increase...