Risk attitude, planting conditions and the value of seasonal forecasts to a dryland wheat grower

The value of a seasonal forecasting system based on phases of the Southern Oscillation was estimated for a representative dryland wheat grower in the vicinity of Goondiwindi. In particular the effects on this estimate of risk attitude and planting conditions were examined. A recursive stochastic programming approach was used to identify the grower's utility-maximising action set in the event of each of the climate patterns over the period 1894-1991 recurring In the imminent season. The approach was repeated with and without use of the forecasts. The choices examined were, at planting, nitrogen application rate and cultivar and, later in the season, choices of proceeding with or abandoning each wheat activity, The value of the forecasting system was estimated as the maximum amount the grower could afford to pay for its use without expected utility being lowered relative to its non use.

Risk Attitude And Wage Growth: Replication And Reconstruction

We replicate Shaw (1996) who found that individual wage growth is higher for individuals with greater preference for risk taking. Expanding her dataset with more American observations and data for Germany, Spain and Italy, we find mixed support for the earlier results. We present and estimate a new model and find that in particular the wage level is sensitive to attitudes towards risk taking. Comments given at the Labour Economics Conference in honour of Niels Westergaard (Nyborg, August 2008) and EALE 2008 (Amsterdam) and at seminars in Maastricht,Reus and Essen (RWI) are gratefully acknowledged. The authors also acknowledge financial support from the Spanish Ministry of Science and Innovation (grant number SEJ2007-66318) and from the Barcelona Economics Program of CREA. JEL code: J24; J30. Key words: wage growth, risk, post-school investment.

Incentive effects on risk attitude in small probability prospects

We report between-subject results on the effect of monetary stakes on risk attitudes. While we find the typical risk seeking for small probabilities, risk seeking is reduced under high stakes. This suggests that utility is not consistently concave.

A fuzzy risk attitude classification based on prospect theory

Traditional methods do not actually measure peoples’ risk attitude naturally and precisely. Therefore, a fuzzy risk attitude classification method is developed. Since the prospect theory is usually considered as an effective model of decision making, the personalized parameters in prospect theory are firstly fuzzified to distinguish people with different risk attitudes, and then a fuzzy classification database schema is applied to calculate the exact value of risk value attitude and risk be- havior attitude. Finally, by applying a two-hierarchical clas- sification model, the precise value of synthetical risk attitude can be acquired.

A szervezet kockázati attitűdjének jelentősége a szerződéses kapcsolatokban (Significance of the organizational risk attitude on the contractual relations)

A tanulmány azt vizsgálja, milyen befolyással van a szervezetek kockázati attitűdje az általuk kötött szerződésre, elsősorban a projektszintű kockázatok megosztására. Esettanulmányként egy PPP-projekt szerződését használja fel, amely jól szemlélteti, hogy az eltérő kockázati magatartású szervezetek egymás közötti kockázatallokációja eltér az optimálistól. A konkrét esetben a közösségi aktor kerül kockázati aspektusból hátrányos helyzetbe. A vizsgálat eredménye, hogy meghatároz néhány kulcsparamétert, melyek a felek kockázati szempontból nyertes vagy vesztes pozícióját döntő módon befolyásolják. ___________ This paper examines the influence of the risk attitude of organizations on the contracts made by them, especially on allocation of the project level risk. A PPP project contract is used as a case study, because it illustrates expressively that the risk allocation between the concerned organiza tions with different risk attitudes differs from the optimal version. In this very case the public actor's position becomes disadvantageous. Specification some of the key parameters able to determine the winner or loser position of the risk taken parties is defined as the outcome of this study.

Does risk aversion or attraction depend on income? An experiment

Does risk attitude (aversion or attraction) vary with the level of the income at risk? About half of our subjects chose to insure all levels, whereas another half chose instead not to insure low levels, but to insure high levels.

Selection and application of risk management tools and techniques for build-operate-transfer projects

Construction projects are risky. However, the characteristics of the risk highly depend on the type of procurement being adopted for managing the project. A build-operate-transfer (BOT) project is recognized as one of the most risky project schemes. There are instances of project failure where a BOT scheme was employed. Ineffective rts are increasingly being managed using various risk management tools and techniques. However, application of those tools depends on the nature of the project, organization's policy, project management strategy, risk attitude of the project team members, and availability of the resources. Understanding of the contents and contexts of BOT projects, together with a thorough understanding of risk management tools and techniques, helps select processes of risk management for effective project implementation in a BOT scheme. This paper studies application of risk management tools and techniques in BOT projects through reviews of relevant literatures and develops a model for selecting risk management process for BOT projects. The application to BOT projects is considered from the viewpoints of the major project participants. Discussion is also made with regard to political risks. This study would contribute to the establishment of a framework for systematic risk management in BOT projects.

Substance Use and Sexual Risk Behaviors among Adolescent Detainees

During the past two decades there has been much research conducted on the relationship between the risky sexual behavior practices and substance use among U.S. adolescents. This body of research has documented the fact that substance use and not using condoms are the most important indicators associated with the risk of becoming infected with sexually transmitted diseases (STD) both among adolescents and adults (Florida Department of Public Health, 2004; Malow, Devieux, Jennings, & Lucenko, 2001; McCoy & Inciardi, 1995). Data from those reports and studies indicate that adolescents and adults who use a condom regularly and appropriately are 20 times less likely to contract an STD than those who do not (Pinkerton & Abramson, 1997). However, less empirical evidence exists about the factors that influence adolescent use of condoms, particularly among adolescents who are detained due to their criminal lifestyle. Researchers have found both a high prevalence of STD in addition to early onset of sexual activity without protection among some adolescent groups such as the detainees (D'angelo & DiClemente, 1996) and that adolescents tend to underestimate their risks of acquiring the human immunodeficiency virus (HIV) (Magura, Shapiro, & Kang, 1994). Many adolescents will experiment with alcohol and other drugs. This behavior may compromise their judgment and increase their chances of engaging in risky sex (Rotheram-Borus, 2000). Hence the need for research that investigates the influence that substance use, risky sexual attitudes, knowledge about the transmission of HIV, and both peer and parental approval of condom use have on the use of condoms among both female and male adolescent detainees. Lastly, it is important for additional research to be conducted because adolescent detainees have been identified as being at high risk of becoming infected with an STD (Malow, Rosemberg, & Devieux, 2006). The purpose of this study was to examine the relationship among adolescent substance use, gender, sexual risk attitude, attitude about personal use of condoms, knowledge associated with the transmission of HIV, peer and family approval of condom use, history of sexually transmitted diseases (STD) and the level of condom use in a sample of adolescents housed in a correctional institution. Further details of the explanatory variables, the control variables and their expected relationships can be found in the review of the Literature in Chapter 2. Also, more information about the separate analysis of the research questions is detailed in the Methods section in Chapter 3. Based on the literature detailed in Chapter 2 (e.g., Malow et al., 2006), the current study’s researcher anticipated that adolescents’ higher levels of illicit drug use would be related to higher levels of sexual risk behaviors, as measured by lower levels of condom use, than their counterparts who used no drugs. Similarly, it was hypothesized that positive attitudes toward condom use and higher levels of HIV risk knowledge would be associated with a lower level of risky sexual behaviors along with a higher level of condom use skill. It was further hypothesized that the level of approval perceived from parents and peers regarding condom use was going to be related to adolescents’ safe sex behavior (i.e., condom use). Therefore, it was expected that participants’ perception of a high level of approval to use condoms from peers and parents would be a statistically significant variable in helping explain the condom use within this sample of adolescent detainees.

Attitudes towards risk in financial decision making

Doutoramento em Gestão

The value of useless information

There are many situations in which individuals have a choice of whether or notto observe eventual outcomes. In these instances, individuals often prefer to remainignorant. These contexts are outside the scope of analysis of the standard vonNeumann-Morgenstern (vNM) expected utility model, which does not distinguishbetween lotteries for which the agent sees the final outcome and those for which hedoes not. I develop a simple model that admits preferences for making an observationor for remaining in doubt. I then use this model to analyze the connectionbetween preferences of this nature and risk-attitude. This framework accommodatesa wide array of behavioral patterns that violate the vNM model, and thatmay not seem related, prima facie. For instance, it admits self-handicapping, inwhich an agent chooses to impair his own performance. It also accommodatesa status quo bias without having recourse to framing effects, or to an explicitdefinition of reference points. In a political economy context, voters have strictincentives to shield themselves from information. In settings with other-regardingpreferences, this model predicts observed behavior that seems inconsistent witheither altruism or self-interested behavior.

The gain-loss asymmetry and single-self preferences

Kahneman and Tversky asserted a fundamental asymmetry between gains and losses, namely a reflection effect which occurs when an individual prefers a sure gain of $ pz to anuncertain gain of $ z with probability p, while preferring an uncertain loss of $z with probability p to a certain loss of $ pz.We focus on this class of choices (actuarially fair), and explore the extent to which thereflection effect, understood as occurring at a range of wealth levels, is compatible with single-self preferences.We decompose the reflection effect into two components, a probability switch effect,which is compatible with single-self preferences, and a translation effect, which is not. To argue the first point, we analyze two classes of single-self, nonexpected utility preferences, which we label homothetic and weakly homothetic. In both cases, we characterize the switch effect as well as the dependence of risk attitudes on wealth.We also discuss two types of utility functions of a form reminiscent of expected utility but with distorted probabilities. Type I always distorts the probability of the worst outcome downwards, yielding attraction to small risks for all probabilities. Type II distorts low probabilities upwards, and high probabilities downwards, implying risk aversion when the probability of the worst outcome is low. By combining homothetic or weak homothetic preferences with Type I or Type II distortion functions, we present four explicit examples: All four display a switch effect and, hence, a form of reflection effect consistent a single self preferences.

‘Driving Forces of Investment Decisions in Mutual Funds’

Unfortunately, in India it is a fact that most of the investors are not interested in mutual funds. Those who are investing, they are investing only very small amounts. But what is important to be noted here is that when compared to other financial instruments, investments in mutual funds are safer and also yields more returns on the investment portfolio. Moreover as an investment avenue mutual fund is available for those investors who are not willing to take any exposure directly in the security market. It also helps such investors to build their wealth over a period of time. At the retail level, investors are unique and are highly heterogeneous, and the mutual fund schemes' selection will also differ depends on their expectations. Hence, investors’ expectation is a very important factor in this regard that needs to be analysed by all the investment houses. Hence, the factors that drive the investment decisions of individual investors to meet their expectations by investing money in mutual funds need an in-depth analysis. These driving forces include the preference of investors on mutual fund compared to various available avenues of financial investments, risk attitude of investors, influence of characteristics of instruments of mutual funds on investors, the investment specific attitudes of investors, and influence of qualities of fund management on investors. The success of any mutual fund, a popular means of investment, depends on how effectively an Asset Management Company has been able to understand the level of influence of these factors on the decision of investors to invest in mutual funds. For a substantial growth in the mutual fund market, there must be a high level precision in the design and marketing of the products of mutual funds taking into account these driving forces by the Asset Management Companies. Therefore, there is a need to conduct a detailed study on investments in mutual funds in this direction. A review of available literature also revealed that no detailed study on mutual funds has so far been attempted in this direction; hence the present study on Driving Forces of Investment Decisions in Mutual Funds is undertaken.

Impact investing: portfolio company selection in Latin America

O documento analisa como investidores de impacto selecionar suas companhias de portfólio na América Latina e que critérios são avaliados no processo. Uma vez que praticamente ne-nhuma pesquisa sobre isso foi con conduzidos até à data, e desde que o modelo de processo de seleção aplicados em capital de risco não é dissemelhantes, foi adotado essa abordagem. Os resultados revelam que os investidores de impacto originar e avaliar negócios de uma for-ma semelhante a capitalistas de risco , mas que alguns critérios são ajustados e outros adicio-nados a fim de refletir o duplo objectivo de investimento de impacto. Os investidores de im-pacto podem originar ofertas passivamente, mas eles preferem procurar empreendimentos sociais de forma proativa: contatos pessoais, o acesso a redes e eventos do setor são cruciais neste contexto. Impacto Investidores considerando um investimento em pesquisa para a Amé-rica Latina inteira, empreendedores sociais honestos e confiáveis comprometidos com impacto social; empreendimentos sociais elegíveis devem ser rentáveis com potencial de escalabilidade; o produto deve ter um impacto social, ou seja, criar valor para o consumidor individual e para a comunidade em geral; tamanho do mercado e crescimento do mercado são fatores externos cruciais; e as características de negócio dependem de atitude de risco do investidor e as perspectivas de uma saída bem sucedida, tanto em termos financeiros e sociais. Os investi-dores de impacto também estão dispostos a dar apoio não financeiro antes de um investimen-to, se um empreendimento social, mostra alto potencial para atingir o seu objectivo dual.

Potential yield and water-use effficiency benefits in sorghum from limited maximum transpiration rate

Limitations on maximum transpiration rates, which are commonly observed as midday stomatal closure, have been observed even under well-watered conditions. Such limitations may be caused by restricted hydraulic conductance in the plant or by limited supply of water to the plant from uptake by the roots. This behaviour would have the consequences of limiting photosynthetic rate, increasing transpiration efficiency, and conserving soil water. A key question is whether the conservation of water will be rewarded by sustained growth during seed fill and increased grain yield. This simulation analysis was undertaken to examine consequences on sorghum yield over several years when maximum transpiration rate was imposed in a model. Yields were simulated at four locations in the sorghum-growing area of Australia for 115 seasons at each location. Mean yield was increased slightly ( 5 - 7%) by setting maximum transpiration rate at 0.4 mm h(-1). However, the yield increase was mainly in the dry, low-yielding years in which growers may be more economically vulnerable. In years with yield less than similar to 450 g m(-2), the maximum transpiration rate trait resulted in yield increases of 9 - 13%. At higher yield levels, decreased yields were simulated. The yield responses to restricted maximum transpiration rate were associated with an increase in efficiency of water use. This arose because transpiration was reduced at times of the day when atmospheric demand was greatest. Depending on the risk attitude of growers, incorporation of a maximum transpiration rate trait in sorghum cultivars could be desirable to increase yields in dry years and improve water use efficiency and crop yield stability.