Gains and losses. The same or different choices?
AbstractArrangements (agreements, contracts, projects, etc.) are widespread economic events and are the fundamental concept of the economic theory. Infringements (breaches, modifications, changes, etc.) of arrangements are common and have a significant importance for the economic theory. For many years now the arrangement infringements have lacked appropriate attention in the economic theory. This fact caused a number of theoretical and practical problems. In order to solve them a new approach is proposed, which considers the possibility of arrangement infringements. The approach application in relation to choosing between risky and guaranteed outcomes is discussed. The article demonstrates the approach able to give the same results for both gains and losses. The concept of the space of “Anything can happen” is introduced. The article gives examples of practical application of the approach in relation to bank deposits, investments, business projects and international activities such as Millennium Dome-like projects and Olympiad-like projects.
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Bibliographic InfoPaper provided by EconWPA in its series International Finance with number 0508004.
Length: 8 pages
Date of creation: 10 Aug 2005
Date of revision:
Note: Type of Document - pdf; pages: 8
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risk; choice; investments; banking; industry; market; development;
Find related papers by JEL classification:
- C - Mathematical and Quantitative Methods
- D - Microeconomics
- E - Macroeconomics and Monetary Economics
- F - International Economics
- G - Financial Economics
- O - Economic Development, Technological Change, and Growth
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