Utility functions whose parameters depend on initial wealth

Article Abstract:

The article examines a new form of utility function that has parameters dependent on initial wealth, unlike conventional utility functions that rely on definitions of final wealth. Discussion includes exponential and quadratic utility functions with robust risky assets and decreasing risk aversion.

Usage, Measurement, Investments, Wealth, Utility theory, Utility functions, Econometric models

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Partial delegation in a model of currency crisis

Article Abstract:

Research shows that the realignment costs range is reduced by delegating the realignment magnitude decision to a central banker who is inflation-adverse, given conditions that include a fixed exchange rate scheme that offers an escape clause. Implications of this strategy are discussed.

Management dynamics, Management, Central banks, Monetary policy, Company business management

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Rational speculative bubbles: an empirical investigation of the London Stock Exchange

Article Abstract:

The article examines the divergence of equity prices from dividends in the London Stock Exchange, and posits that this is explained by a speculative bubble. Cointegration tests, bubble specification tests, and variance bounds tests are used to support the conclusion.

Security and Commodity Services, Securities & Commodities Services, Securities, Commodity Contracts, and Other Financial Investments and Related Activities, Speculation, Securities industry, London Stock Exchange PLC

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