The decomposition of risk in denumerable populations with ex ante identical individuals
Article Abstract:
A method for decomposing risk into an aggregate and a unique segment which avoids the problems related to continuums of random variables is presented. It is argued that a denumerable population is more appropriate for approximating a large finite economy and that zero weight can be ascribed to any finite number of agents in this condition. This analysis demonstrates that a highly accurate decomposition of risk is possible in this framework and identifies the sigma-field of aggregate events. Findings formalize basic arguments that are hard to prove in the continuum context.
Publication Name: Journal of Economic Theory
Subject: Economics
ISSN: 0022-0531
Year: 1999
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Continuous approximation of dynamical systems with randomly matched individuals
Article Abstract:
The random matching strategy used by both biologists and economists when dealing with population statistics is analyzed in relation to constraints such as the case of a growing population. The matching strategy is quite complex and users are forced to use a deterministic procedure to approximate results. A differential equation is formulated to cope with the given constraints.
Publication Name: Journal of Economic Theory
Subject: Economics
ISSN: 0022-0531
Year: 1995
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Relative risk aversion, relative prudence and comparative statics under uncertainty: The case of (mu,theta )preferences
Article Abstract:
The magnitudes of relative prudence and relative risk aversion are characterized in terms of the mean-standard, two-parameter approach, which is compared and contrasted with the expected-utility approach.
Publication Name: Bulletin of Economic Research
Subject: Economics
ISSN: 0307-3378
Year: 2004
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