Putting Risk in Its Proper Place

S-Tier
Journal: American Economic Review
Year: 2006
Volume: 96
Issue: 1
Pages: 280-289

Score contribution per author:

4.022 = (α=2.01 / 2 authors) × 4.0x S-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

This paper examines preferences toward particular classes of lottery pairs. We show how such concepts as prudence and temperance can be fully characterized by a preference relation over these lotteries. If preferences are defined in an expected-utility framework with differentiable utility, the direction of preference for a particular class of lottery pairs is equivalent to signing the nth derivative of the utility function. What makes our characterization appealing is its simplicity, which seems particularly amenable to experimentation.

Technical Details

RePEc Handle
repec:aea:aecrev:v:96:y:2006:i:1:p:280-289
Journal Field
General
Author Count
2
Added to Database
2026-01-25