IDEAS home Printed from https://ideas.repec.org/a/aea/aecrev/v103y2013i4p1536-37.html
   My bibliography  Save this article

Even (Mixed) Risk Lovers Are Prudent: Comment

Author

Listed:
  • Sebastian Ebert

Abstract

Crainich, Eeckhoudt, and Trannoy (2013) show that mixed risk lovers are prudent. I show that common risk loving utility functions may not exhibit mixed risk loving??as is typical for risk aversion and mixed risk aversion??and thus these traits should be carefully distinguished. In particular, risk lovers may be imprudent.

Suggested Citation

  • Sebastian Ebert, 2013. "Even (Mixed) Risk Lovers Are Prudent: Comment," American Economic Review, American Economic Association, vol. 103(4), pages 1536-1537, June.
    • Handle: RePEc:aea:aecrev:v:103:y:2013:i:4:p:1536-37
    Note: DOI: 10.1257/aer.103.4.1536
    as

    Download full text from publisher

    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/aer.103.4.1536
    Download Restriction: no
    File URL: http://www.aeaweb.org/aer/ds/june2013/20120861_ds.zip
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Paan Jindapon & Christopher Whaley, 2015. "Risk lovers and the rent over-investment puzzle," Public Choice, Springer, vol. 164(1), pages 87-101, July.
    2. Sebastian Ebert & Daniel Wiesen, 2014. "Joint measurement of risk aversion, prudence, and temperance," Journal of Risk and Uncertainty, Springer, vol. 48(3), pages 231-252, June.
    3. Timo Heinrich & Thomas Mayrhofer, 2018. "Higher-order risk preferences in social settings," Experimental Economics, Springer;Economic Science Association, vol. 21(2), pages 434-456, June.
    4. Harashima, Taiji, 2018. "Bubbles and Bluffs: Risk Lovers Can Survive Economically," MPRA Paper 83615, University Library of Munich, Germany.
    5. Colasante, Annarita & Riccetti, Luca, 2020. "Risk aversion, prudence and temperance: It is a matter of gap between moments," Journal of Behavioral and Experimental Finance, Elsevier, vol. 25(C).
    6. Harris Schlesinger, 2014. "Lattices and Lotteries in Apportioning Risk," CESifo Working Paper Series 5067, CESifo.
    7. Donatella Baiardi & Marco Magnani & Mario Menegatti, 2020. "The theory of precautionary saving: an overview of recent developments," Review of Economics of the Household, Springer, vol. 18(2), pages 513-542, June.
    8. Wang, Hongxia & Wang, Jianli & Li, Jingyuan & Xia, Xinping, 2015. "Precautionary paying for stochastic improvements under background risks," Insurance: Mathematics and Economics, Elsevier, vol. 64(C), pages 180-185.
    9. Rachel J. Huang & Larry Y. Tzeng & Lin Zhao, 2020. "Fractional Degree Stochastic Dominance," Management Science, INFORMS, vol. 66(10), pages 4630-4647, October.
    10. Gollier, Christian, 2019. "Variance stochastic orders," Journal of Mathematical Economics, Elsevier, vol. 80(C), pages 1-8.
    11. Christophe Courbage & Béatrice Rey, 2018. "On temperance and risks spreading," Working Papers 1828, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    12. François Pannequin & Anne Corcos, 2020. "Are compulsory insurance and self-insurance substitutes or complements? A matter of risk attitudes," The Geneva Risk and Insurance Review, Palgrave Macmillan;International Association for the Study of Insurance Economics (The Geneva Association), vol. 45(1), pages 24-35, March.
    13. Gollier, Christian, 2021. "A general theory of risk apportionment," Journal of Economic Theory, Elsevier, vol. 192(C).
    14. Mario Menegatti & Richard Peter, 2022. "Changes in Risky Benefits and in Risky Costs: A Question of the Right Order," Management Science, INFORMS, vol. 68(5), pages 3625-3634, May.
    15. Diego C. Nocetti, 2016. "Robust Comparative Statics of Risk Changes," Management Science, INFORMS, vol. 62(5), pages 1381-1392, May.
    16. Ilia Tsetlin & Robert L. Winkler & Rachel J. Huang & Larry Y. Tzeng, 2015. "Generalized Almost Stochastic Dominance," Operations Research, INFORMS, vol. 63(2), pages 363-377, April.
    17. Paan Jindapon & Liqun Liu & William S. Neilson, 2021. "Comparative risk apportionment," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 9(1), pages 91-112, April.
    18. Christian Gollier, 2021. "A general theory of risk apportionment," Post-Print hal-04164327, HAL.
    19. Christophe Courbage & Béatrice Rey, 2020. "On temperance and risk spreading," Theory and Decision, Springer, vol. 88(4), pages 527-539, May.
    20. Alfred Müller & Marco Scarsini & Ilia Tsetlin & Robert L. Winkler, 2017. "Between First- and Second-Order Stochastic Dominance," Management Science, INFORMS, vol. 63(9), pages 2933-2947, September.
    21. Christophe Courbage & Béatrice Rey, 2018. "On temperance and risks spreading," Working Papers halshs-01935866, HAL.

    More about this item

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aecrev:v:103:y:2013:i:4:p:1536-37. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.