WP 2015

WP 2015-13 The Methodologies of Behavioral Insurance: Introduction to the Special Issue

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Published in 2016 in The Journal of Risk and Insurance, Volume 83, Issue 1.

AUTHORS: Glenn W. Harrison and Andreas Richter

ABSTRACT: The generic insurance product involves an agent giving up a certain amount of money ex ante some risky event in the expectation of being given some money in the future if… more »

WP 2015-12 Are Risks Over Multiple Attributes Traded Off? A Case Study of Aid

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Published in 2019 in Journal of Economic Behavior and Organization, Volume 164.

AUTHORS: Lata Gangadharan, Glenn W. Harrison and Anke D. Leroux

ABSTRACT: Understanding decisions in situations involving multiple risks is vital in many contexts, including the provision of aid to developing countries. Aid typically involves trade-offs over multiple, desirable, but risky… more »

WP 2015-11 Risk Preferences, Time Preferences, and Smoking Behavior

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Published in 2018 in Southern Economic Journal, Volume 85, Issue 2.

AUTHORS: Glenn W. Harrison, Andre Hofmeyr, Don Ross, and J. Todd Swarthout

ABSTRACT: There is a rich theoretical literature in economics which models habit-forming behaviors, of which addiction is the exemplar, but there is a paucity of experimental economic studies eliciting… more »

WP 2015-10 Evaluating the Expected Welfare Gain from Insurance

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Published in 2016 in The Journal of Risk and Insurance, Volume 83, Issue 1.

AUTHORS: Glenn W. Harrison and Jia Min Ng

ABSTRACT: Economic theory tells us how to evaluate the expected welfare gain from insurance products on offer to individuals. If we know the risk preferences of the individual, and subjective beliefs… more »

WP 2015-09 Empirical Likelihood Inference for Haezendonck-Goovaerts Risk Measure

Posted On July 13, 2015
Categories Working Papers, WP 2015

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AUTHORS: Liang Peng, Xing Wang and Yanting Zheng

Abstract. Recently Haezendonck-Goovaerts risk measure is receiving much attention in actuarial science with applications in the study of optimal portfolio and optimal reinsurance policy. Nonparametric estimation is proposed by Ahn and Shyamalkumar (2014), where the derived asymptotic limit can be employed to construct an interval… more »

WP 2015-08 The Effect of Information System Precision on Honesty in Managerial Reporting: An Experimental Examination Incorporating Operating Uncertainty

Posted On June 29, 2015
Categories Working Papers, WP 2015

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AUTHORS: Heba Y. Abdel-Rahim and Douglas E. Stevens

ABSTRACT: We apply insights from a model of social norm activation to an agency model of capital budgeting to develop a positive behavioral relation between information system precision and honesty in managerial reporting. This relation is based on the ability of a precise information system to… more »

WP 2015-07 What Drives Tort Reform Legislation? An Analysis of State Decisions to Restrict Liability Torts

Posted On June 8, 2015
Categories Working Papers, WP 2015

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AUTHORS: Yiling Deng and George Zanjani

ABSTRACT: This paper studies the timing of state-level tort reform enactments between 1971 and 2005. Using discrete time hazard models, we find the level of litigation activity—as measured by incurred liability insurance losses, the number of lawyers, and tort cases commenced—to be the most important and robust… more »

WP 2015-06 Capital, Systemic Risk, Insurance Prices and Regulation

Posted On April 17, 2015
Categories Working Papers, WP 2015

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AUTHORS: Ajay Subramanian and Jinjing Wang

We develop a unified equilibrium model of competitive insurance markets that incorporates the demand and supply of insurance as well as insurers’ asset and liability risks. Insurers’ assets may be exposed to both idiosyncratic and systemic shocks. We obtain new insights into the relationship between insurance premia… more »

WP 2015-05 Information Characteristics and Errors in Expectations: Experimental Evidence

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Published in 2017 in Journal of Financial and Quantitative Analysis, Volume 52, Issue 2.

AUTHORS: Constantinos Antoniou, Glenn W. Harrison, Morten I. Lau, and Daniel Read

ABSTRACT: We design an experiment to test the hypothesis that, in violation of Bayes’ rule, some people respond more forcefully to the strength of information than… more »