Collusion Under Risk Aversion and Fixed Costs

Fixed Costs, Investment Rigidities, and Risk Aversion in Information Security: A Utility-theoretic Approach

This paper addresses the question of determining the optimal timing of interventions in information security management. Using utility theory, we derive the limiting condition under which, given a potential or realized risk, a decision to invest, delay, or abandon can be justified. Our primary focus is on the decision to defer costly deterministic investments, such as the removal of a service o...

Duopolistic competition under risk aversion and uncertainty

A monopolist typically defers entry into an industry as both price uncertainty and the level of relative risk aversion increase. The former attribute may be present in most deregulated industries, while the latter may be relevant for reasons of market incompleteness or the presence of technical uncertainty. By contrast, it has been shown that the presence of a rival hastens entry under risk neu...

Is it lie aversion , risk - aversion or tax audit aversion ? Modeling deception under risk and no risk

We studied deceptive decision making in hypothetical scenarios that involved risk of being caught of deceiving, or a penalty after being caught of deceiving, or both. We found that the deception rate was the lowest in the scenarios involving both the risk and the penalty. Our hierarchical model for deception suggests that in balancing the possible benefits from deception, the personal discomfor...

Portfolio Optimization Under Fixed Transaction Costs

Spatial Production Concentration under Yield Risk and Risk Aversion

A study of equilibrium acreage allocation decisions at the farm and regional levels under risk aversion, yield uncertainty, and endogenous crop prices is undertaken in a two-crop, two-region setting. The main insight is that a partial specialization in one crop at a regional level may be an equilibrium dominant strategy relative to the more diversified crop mix produced on farm. This is due to ...