ISSN:
1554-9658
Keywords:
Risk
;
Insurance Demand
;
Deterministic Transformations
;
Stochastic Dominance
;
Expected Utility
Source:
Springer Online Journal Archives 1860-2000
Topics:
Economics
Notes:
Abstract The consequences of a change in a random parameter are determined for a decision model with more than one source of randomness. The two cases of independent and stochastically dependent sources of risk are discussed. Four comparative static theorems are given. These state the effect of first degree stochastically dominant shifts or risk decreases for one random variable while the other random variable is held fixed. Deterministic transformations are used to represent random parameter changes. The results are presented in the context of the coinsurance demand model with a risky insurable asset and background risk.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1007/BF00941954
