When risk generates chaos

Article Abstract:

The traditional linear cobweb model becomes nonlinear with risk averse producers. With a quantity that is an homographic function of prior years quantities, the market may produce chaotic price and quantity series particularly if demand is rigid. Hedging facilities are ineffective in lowering the level of socially counterproductive fluctuations. This might be used as a reason for public intervention on markets. Implications are discussed.

Chaos theory, Chaotic systems

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A note on the Tullock dissipation rate

Article Abstract:

The Tullock model for dissipation rates is examined after risk aversion is integrated. In a monopoly, the dissipation rate rises as rent rises. Results show that risk aversion in a large rent-seeking contest can cause the dissipation of time and resources to fall to near risk-neutral level in which the value of resource spending and the value of the monopoly rent are the same.

Research, Usage, Cost benefit analysis, Economic rent

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Systemic risk on the interbank market

Article Abstract:

The systemic risk involved in interbank lending is studied based on banking systems with homogeneous and heterogeneous banks.

United Kingdom, Commercial Banks, Management dynamics, Venture Analysis, Banking industry, Management, Company business management

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