Arrow-Pratt Measure of Absolute and Relative Risk Aversion
This video discusses measures by which the degree of risk aversion is measured. We present the Arrow-Pratt measures of risk aversion and provide an example using calculus of computing such measures.
Created by Justin S. Eloriaga
Пікірлер: 23
Thanks a lot, prof. Justin! Your video is certainly the best on the Arrow-Pratt risk aversion coefficient on KZread!
@elvitd6704
Жыл бұрын
for sure, couldn't find any better
You're my hero, thanks a lot!
This was helpful. Thanks! Keep making more videos.
This was brilliant, made it very easy to understand
Thank you a lot, the video did provide a helpful explanation
thank you, it was certainly very helpful.
you have helped me a lot thank you so muchh
It helped, thanks
good job man
TE AMO GRACIAS!
Thank you so much! what would you say is this individual's absolute and relative risk aversion? U(Y)= 1-e^2*Y
great video
Very nice explanation ,
Very helpful.. Thnks
Why is it divided to relative sense or absolue sense if it makes the same conclusion because if we say the invested percentage increase in risky assets it is same if we say we hold more amount in risk assets ?
awesome video!! can you link the paper, from where this informations are from pls?
Can you make a practice or tutorial example of Arrow-Pratt Measure of Absolute and Relative Risk Aversion in Stata?
Sir, at 19:18 , i think that should be written as "as wealth *decreases" instead of increases.
Why is the absolute risk aversion defined in that way (as a ratio of the 2nd and 1st derivatives)? Why not just use the 2nd derivative to see how much the utility function is levelling off?
@mateuspucciarelli7799
Жыл бұрын
because the results shouldn't change if you make an affine transformation of the utility function, it is, u(x) and v(x) = a*u(x) + b should be able to represent the same situation. But r(x) = u''(x) is not equal to r(x) = v''(x) = a*u''(x)
My last resort :)
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