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Risky targets and effort

Author

Listed:
  • O.C. Chuang
  • L. Eeckhoudt

    (LEM - Lille - Economie et Management - CNRS - Centre National de la Recherche Scientifique - UCL - Université catholique de Lille - Université de Lille)

  • R.J. Huang
  • L.Y. Tzeng

Abstract

When decision makers invest in effort to reach their targets, they face multiple sources of risk: first the risk of failure and second the noise that surrounds either the target or the initial situation. In this paper, we examine how effort is adjusted to account for changes in this risky environment.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • O.C. Chuang & L. Eeckhoudt & R.J. Huang & L.Y. Tzeng, 2013. "Risky targets and effort," Post-Print hal-00845897, HAL.
  • Handle: RePEc:hal:journl:hal-00845897
    Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-00845897
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    References listed on IDEAS

    as
    1. Courbage, Christophe & Rey, Béatrice, 2012. "Optimal prevention and other risks in a two-period model," Mathematical Social Sciences, Elsevier, vol. 63(3), pages 213-217.
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    3. Bruno Jullien & Bernard Salanié & François Salanié, 1999. "Should More Risk-Averse Agents Exert More Effort?," The Geneva Risk and Insurance Review, Palgrave Macmillan;International Association for the Study of Insurance Economics (The Geneva Association), vol. 24(1), pages 19-28, June.
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    Citations

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    Cited by:

    1. Crainich, David & Eeckhoudt, Louis & Menegatti, Mario, 2016. "Changing risks and optimal effort," Journal of Economic Behavior & Organization, Elsevier, vol. 125(C), pages 97-106.
    2. Huang, Rachel J., 2012. "Ambiguity aversion, higher-order risk attitude and optimal effort," Insurance: Mathematics and Economics, Elsevier, vol. 50(3), pages 338-345.
    3. Huang, Yi-Chieh & Tzeng, Larry Y. & Zhao, Lin, 2015. "Comparative ambiguity aversion and downside ambiguity aversion," Insurance: Mathematics and Economics, Elsevier, vol. 62(C), pages 257-269.
    4. Wong, Kit Pong, 2017. "A note on risky targets and effort," Insurance: Mathematics and Economics, Elsevier, vol. 73(C), pages 27-30.

    More about this item

    JEL classification:

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

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