Comparative risk aversion of different preferences
An article about Kihlstrom and Mirman about comparative risk aversion with many goods is critiqued. If "more risk averse" is interpreted as signifying that an individual is less willing to accept a median-preserving spread, then risk aversion cannot be compared across individuals with different preferences. If it is interpreted as signifying that an individual has a greater directional risk premium, then risk aversion may be compared across individuals with different preferences, in particular in partial equilibrium analysis.
|Date of creation:||2011|
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|Note:||View the original document on HAL open archive server: http://halshs.archives-ouvertes.fr/halshs-00585615/en/|
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