The Risk-Averse (and Prudent) Newsboy

Louis Eeckhoudt, Christian Gollier () and Harris Schlesinger

Management Science, 1995, vol. 41, issue 5, 786-794

Abstract: The effects of risk and risk aversion in the single-period inventory ("newsboy") problem are examined. Comparative-static effects of changes in the various price and cost parameters are determined and related to the newsboy's risk aversion. The addition of a random background wealth and of an increase in the riskiness of newspaper demand are also examined. Although many of the comparative effects generally are ambiguous, some fairly simple restrictions on preferences and/or risk increases are shown to lead to qualitatively deterministic results.

Keywords: newsboy problem; inventory; increase in risk; risk aversion; prudence (search for similar items in EconPapers)
Date: 1995
References: Add references at CitEc
Citations: View citations in EconPapers (179)

Downloads: (external link)
http://dx.doi.org/10.1287/mnsc.41.5.786 (application/pdf)

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: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:41:y:1995:i:5:p:786-794

Access Statistics for this article

More articles in Management Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().