Ebook: Non-Expected Utility and Risk Management: A Special Issue of the Geneva Papers on Risk and Insurance Theory

Expected utility provides simple, testable properties of the optimum behavior that should be displayed by risk-averse individuals in risky decisions. Simultaneously, given the existence of paradoxes under the expected utility paradigm, expected utility can only be regarded as an approximation of actual behavior. A more realistic model is needed. This is particularly true when treating attitudes toward small probability events: the standard situation for insurable risks.
Non-Expected Utility and Risk Management examines whether the existing results in insurance economics are robust to more general models of behavior under risk.

---

Expected utility provides simple, testable properties of the optimum behavior that should be displayed by risk-averse individuals in risky decisions. Simultaneously, given the existence of paradoxes under the expected utility paradigm, expected utility can only be regarded as an approximation of actual behavior. A more realistic model is needed. This is particularly true when treating attitudes toward small probability events: the standard situation for insurable risks.
Non-Expected Utility and Risk Management examines whether the existing results in insurance economics are robust to more general models of behavior under risk.

---

Expected utility provides simple, testable properties of the optimum behavior that should be displayed by risk-averse individuals in risky decisions. Simultaneously, given the existence of paradoxes under the expected utility paradigm, expected utility can only be regarded as an approximation of actual behavior. A more realistic model is needed. This is particularly true when treating attitudes toward small probability events: the standard situation for insurable risks.
Non-Expected Utility and Risk Management examines whether the existing results in insurance economics are robust to more general models of behavior under risk.
Content:
Front Matter....Pages 1-5
Introductory Note....Pages 7-8
Non-Expected Utility and the Robustness of the Classical Insurance Paradigm....Pages 9-50
Non-Expected Utility and the Robustness of the Classical Insurance Paradigm: Discussion....Pages 51-56
The Comparative Statics of Deductible Insurance in Expected- and Non-Expected-Utility Theories....Pages 57-72
Risk-Aversion Concepts in Expected- and Non-Expected-Utility Models....Pages 73-91
Government Action, Biases in Risk Perception, and Insurance Decisions....Pages 93-110
A Comparison of the Estimates of Expected Utility and Non-Expected-Utility Preference Functionals....Pages 111-133
Functional Form Problems in Modeling Insurance and Gambling....Pages 135-150

---

Expected utility provides simple, testable properties of the optimum behavior that should be displayed by risk-averse individuals in risky decisions. Simultaneously, given the existence of paradoxes under the expected utility paradigm, expected utility can only be regarded as an approximation of actual behavior. A more realistic model is needed. This is particularly true when treating attitudes toward small probability events: the standard situation for insurable risks.
Non-Expected Utility and Risk Management examines whether the existing results in insurance economics are robust to more general models of behavior under risk.
Content:
Front Matter....Pages 1-5
Introductory Note....Pages 7-8
Non-Expected Utility and the Robustness of the Classical Insurance Paradigm....Pages 9-50
Non-Expected Utility and the Robustness of the Classical Insurance Paradigm: Discussion....Pages 51-56
The Comparative Statics of Deductible Insurance in Expected- and Non-Expected-Utility Theories....Pages 57-72
Risk-Aversion Concepts in Expected- and Non-Expected-Utility Models....Pages 73-91
Government Action, Biases in Risk Perception, and Insurance Decisions....Pages 93-110
A Comparison of the Estimates of Expected Utility and Non-Expected-Utility Preference Functionals....Pages 111-133
Functional Form Problems in Modeling Insurance and Gambling....Pages 135-150
....