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Radical uncertainty: Sources, manifestations and implications

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  • Müller, Christian
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    This paper argues that radical uncertainty is the outcome of standard market activity. The theoretical findings are corroborated with empirical analyses. The model example is applied to asset pricing and radical uncertainty is found a solution to various asset pricing "puzzles". In conclusion, radical uncertainty should form the basis of economic analysis.

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    File URL: http://www.economics-ejournal.org/economics/discussionpapers/2015-41
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    File URL: https://www.econstor.eu/bitstream/10419/110917/1/827394314.pdf
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    Paper provided by Kiel Institute for the World Economy (IfW) in its series Economics Discussion Papers with number 2015-41.

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    Date of creation: 2015
    Handle: RePEc:zbw:ifwedp:201541
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