A rationalist explanation of Russian risk-taking

Frank Lehrbass () and Valentin Weinhold ()
Additional contact information
Frank Lehrbass: FOM University of Applied Sciences in Düsseldorf, Germany
Valentin Weinhold: University of Düsseldorf, Germany

Economics of Peace and Security Journal, 2016, vol. 11, issue 1, 5-11

Abstract: Three seemingly unrelated topics of Russian politics are investigated. It is shown that under expected utility maximization the assumptions of an unbiased oil forward market and a risk-acceptant attitude (strictly convex utility function) are sufficient to explain Russia’s open position in oil and the bailout of Rosneft. The risk-acceptant attitude of the Russian leader also causes a shrunken bargaining range for the conflict in Ukraine, which can be enlarged by sanctions but not necessarily by the proliferation of weapons. This gives sanctions a clear edge over the proliferation of weapons.

Keywords: Sovereign risk management; commodity risk management; conflict in Ukraine (search for similar items in EconPapers)
JEL-codes: C00 D7 F5 H3 H7 N4 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.epsjournal.org.uk/index.php/EPSJ/article/view/231 (application/pdf)
Open access 24 months after original publication.

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:epc:journl:v:11:y:2016:i:1:p:5-11

Access Statistics for this article

Economics of Peace and Security Journal is currently edited by Michael Brown and J Paul Dunne

More articles in Economics of Peace and Security Journal from EPS Publishing Contact information at EDIRC.
Bibliographic data for series maintained by Michael Brown, Managing Editor, EPSJ ().