A Ratio Criterion for Signing the Effects of an Increase in Uncertainty

Jane M Black and George Bulkley ()

International Economic Review, 1989, vol. 30, issue 1, pages 119-30

Abstract: A decisionmaker wishes to pick b to maximize E[u(z(x,b))] where x is a random variable. A shift in the probability density function of x from f(x) to g(x) is considered where g(x) can be interpreted as representing greater uncertainty. A set of conditions on the behavior of the ratio of f(x) to g(x) over the support of x are derived sufficient to sign the effect of the shift on the decision variable. Copyright 1989 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.

Date: 1989
View citations in EconPapers

Downloads: (external link)
http://links.jstor.org/sici?sici=0020-6598%2819890 ... O%3B2-L&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:ier:iecrev:v:30:y:1989:i:1:p:119-30

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0020-6598

Access Statistics for this article

International Economic Review is edited by Kenneth I. Wolpin

More articles in International Economic Review from Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association
Address: 160 McNeil Building, 3718 Locust Walk, Philadelphia, PA 19104-6297
Contact information at EDIRC.
Series data maintained by ().