between risk and uncertainty is implemented by applying the Gilboa-Schmeidler maxmin with multiple priors framework to lenders …, ultimate lenders and financial intermediaries. The model is used to investigate the impact of uncertainty about the likelihood … include: (i) An unanticipated increase in bailout uncertainty raises interest rates, the volume of defaults in both the real …

Firms in many developing countries cite macroeconomic instability and political uncertainty as major constraints to … their growth. Economic theory suggests uncertainty can cause firms to delay investments until uncertainty is resolved. We … macroeconomic and political uncertainty. Demand for macroeconomic shock insurance was high; 36.7 percent of microentrepreneurs in …

-post auditing. Our results do not show significant effects of variations in random audit rates and switching to a conditional audit …

when liquidation would be value-increasing. To curb fraud, shareholders optimally choose auditing quality and the … performance sensitivity of managerial pay, taking external corporate governance and auditing regulation into account. For given … managerial pay, it is optimal to rely on auditing when external governance is in an intermediate range. When both auditing and …

political uncertainty commands a risk premium whose magnitude is larger in poorer economic conditions. Political uncertainty …We study the pricing of political uncertainty in a general equilibrium model of government policy choice. We find that …

We study the effects of changes in uncertainty about future fiscal policy on aggregate economic activity. Fiscal … consolidation inevitable, there is considerable uncertainty about the policy mix and timing of such budgetary adjustment. To … evaluate the consequences of this increased uncertainty, we first estimate tax and spending processes for the U.S. that allow …

consensus. Our model deepens the discussion of economic risk and political risk in fiscal federalism, and highlights the related …