Description

The need to understand the theories and applications of economic and finance risk has been clear to everyone since the financial crisis, and this collection of original essays proffers broad, high-level explanations of risk and uncertainty. The economics of risk and uncertainty is unlike most branches of economics in spanning from the individual decision-maker to the market (and indeed, social decisions), and ranging from purely theoretical analysis through individual experimentation, empirical analysis, and applied and policy decisions. It also has close and sometimes conflicting relationships with theoretical and applied statistics, and psychology. The aim of this volume is to provide an overview of diverse aspects of this field, ranging from classical and foundational work through current developments.

Key Features

  • Presents coherent summaries of risk and uncertainty that inform major areas in economics and finance
  • Divides coverage between theoretical, empirical, and experimental findings
  • Makes the economics of risk and uncertainty accessible to scholars in fields outside economics

Readership

Graduate students and professors worldwide working in all subdisciplines of economics and finance.

Table of Contents

Section I: Individual Choice under Risk and Uncertainty: Foundations and Measurement

1. Axiomatic Foundations of Expected Utility and Subjective Probability - Edi Karni

2. Rationality and Dynamic Consistency under Risk and Uncertainty – Peter J. Hammond and Horst Zank

3. The Theory of Risk and Risk Aversion – Jack Meyer

4. Assessment and Estimation of Risk Preferences - Charles A. Holt and Susan K. Laury

Section II: Risk and Uncertainty: Markets and Public Policy

5. Insurance and Insurance Markets - Georges Dionne and Scott Harrington

6. Uncertainty and Imperfect Information in Markets - Benjamin E. Hermalin

7. The Value of Individual and Societal Risks to Life and Health – W. Kip Viscusi

8. Economic Analysis of Risk and Uncertainty Induced by Health Shocks: A Review and Extension – Tomas J. Philipson and George Zanjani

9. Regulating Occupational and Product Risks – Thomas J. Kneisner and John D. Leeth

10. Environmental Risk and Uncertainty – Joseph E. Aldy and W. Kip Viscusi

11. Economics of Natural Catastrophic Risk Insurance – Howard Kunreuther and Erwann Michel-Kerjan

Section III: Challenges and Responses to the Classical Model of Risk Preferences and Beliefs

12. Non-Expected Utility Models under Objective Uncertainty – John Quiggin

13.Ambiguity and Ambiguity Aversion – Mark J. Machina and Marciano Siniscalchi

14.Choice Under Uncertainty: Empirical Methods and Experimental Results – John D. Hey

Details

No. of pages:
896
Language:
English
Copyright:
© 2014
Published:
Imprint:
North Holland
Electronic ISBN:
9780444536860
Print ISBN:
9780444536853

About the editors

Mark Machina

Mark Machina is a Fellow at the Amercian Academy of Arts and Sciences and has taught at Columbia University, the University of Cambridge, Princeton University, the People's University of China in Beijing, Duke University, and the University of Wyoming.

W. Viscusi

W. Kip Viscusi is the award-winning author of more than 20 books and 300 articles, most of which deal with different aspects of health and safety risks. His pathbreaking research had addressed a wide range of individual and societal responses to risk and uncertainty, including risky behaviors, governmental regulation, and tort liability.

Reviews

"The Handbook of the Economics of Risk and Uncertainty is sure to find a welcome spot on the reading and reference lists of all modern teachers, researchers, and students of risk management. It is a scholarly and timely collection of cutting-edge theory and measurement, market analysis, and experimental findings, contributed by leading names in the field."  --Olivia S. Mitchell, University of Pennsylvania

"This is a first-rate volume covering both the theory and empirical contributions.  The Handbook gives students and researchers an excellent introduction to state-of-the-art work in risk and uncertainty.  This is a essential reference for researchers working in the field."  --Dan A. Black, University of Chicago