The dynamics of risk-sensitive allocations.

This paper describes Pareto optimal allocations when agents have risk-sensitive preferences as formulated by Hansen and Sargent (IEEE Trans. Automat. Control 40(5) (1995) 968-971). Necessary and sufficient conditions are given for the existence and stability of steady states at which Pareto weights...

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Publicado en:Journal of Economic Theory Vol. 125; no. 2; pp. 93 - 151
Autor principal: Anderson, Evan W.
Formato: Artículo
Publicado: Academic Press Inc. December 2005
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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      pub: Academic Press Inc.
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        atl: The dynamics of risk-sensitive allocations.
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        au: Anderson, Evan W.
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        Resource allocation -- Mathematical models
        Welfare economics
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          Resource allocation -- Mathematical models
          Welfare economics
      ab: This paper describes Pareto optimal allocations when agents have risk-sensitive preferences as formulated by Hansen and Sargent (IEEE Trans. Automat. Control 40(5) (1995) 968-971). Necessary and sufficient conditions are given for the existence and stability of steady states at which Pareto weights are time-invariant. When all agents are risk-sensitive with the same power reward function there is a unique interior steady state which is stable when the power is positive and unstable when the power is negative. When there is at least one agent with time-additive preferences eventually all risk-sensitive agents have zero Pareto weights. Copyright (c) 2005 Elsevier Inc.
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    language: English
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