Wakker (1990) showed that under natural conditions the Choquet expected utility (CEU) and the rank-dependent utility (RDU) models are identical. Invoking Wakker's result and applying the certainty equivalent reduction procedure, this paper shows that risk aversion in the RDU model implies...

In this paper we consider how the presence of private information may explain the failure of the private sector to provide unemployment insurance. In particular, we show how the interaction of private information regarding employees' preferences for work with the unobservable level of effort...