Abstract
This paper concerns utility functions for money. A measure of risk aversion in the small, the risk premium or insurance premium for an arbitrary risk, and a natural concept of decreasing risk aversion are discussed and related to one another. Risks are also considered as a proportion of total assets.
This research was supported by the National Science Foundation (grant NSF-G24035). Reproduction in whole or in part is permitted for any purpose of the United States Government.
The erratum of this chapter is available at http://dx.doi.org/10.1007/978-94-015-7957-5_35
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© 1992 Springer Science+Business Media New York
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Pratt, J.W. (1992). Risk Aversion in the Small and in the Large. In: Dionne, G., Harrington, S.E. (eds) Foundations of Insurance Economics. Huebner International Series on Risk, Insurance and Economic Security, vol 14. Springer, Dordrecht. https://doi.org/10.1007/978-94-015-7957-5_3
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DOI: https://doi.org/10.1007/978-94-015-7957-5_3
Publisher Name: Springer, Dordrecht
Print ISBN: 978-90-481-5789-1
Online ISBN: 978-94-015-7957-5
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