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Comonotonic Processes

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Author Info
Elyès Jouini () (CEREMADE - CEntre de REcherches en MAthématiques de la DEcision - CNRS : UMR7534 - Université Paris Dauphine - Paris IX)
Clotilde Napp (DRM - Dauphine Recherches en Management - CNRS : UMR7088 - Université Paris Dauphine - Paris IX)

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Abstract

We consider in this paper two Markovian processes X and Y, solutions of a stochastic differential equation with jumps, that are comonotonic, i.e., that are such that for all t, almost surely, X_{t} is greater in one state of the world than in another if and only if the same is true for Y_{t}. This notion of comonotonicity can be of great use for finance, insurance and actuarial issues. We show here that the assumption of comonotonicity imposes strong constraints on the coefficients of the diffusion part of X and Y.

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Paper provided by HAL in its series Post-Print with number halshs-00167158_v1.

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Date of creation: 2003
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Publication status: Published, Insurance: Mathematics and Economics, 2003, 255-265
Handle: RePEc:hal:journl:halshs-00167158_v1

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Related research
Keywords: Comonotonicity; Comonotonic processes; Jump processes; Risk sharing schemes; Pareto optimal allocations;

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This page was last updated on 2009-12-22.


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