Comparación del comportamiento de producción de empresas aversas al arrepentimiento y aversas al riesgo

Translated title of the contribution: Comparison of the production behavior of regret-averse and purely risk-averse firms

Xu Guo, Wing Keung Wong

Research output: Contribution to journalArticle

1 Scopus citations

Abstract

Previous studies focused on the comparison of the optimal output levels of regret-averse firms under uncertainty and firms under certainty. This paper extends the theory by further investigating the effects of regret-aversion on production. We compare the optimal output levels of regret-averse firms with purely risk-averse firms under uncertainty and firms under certainty. We first show that the linear-regret firms will surely produce more than their purely risk-averse counterparts and surely produce less than firms under certainty. Thereafter, we give sufficient conditions to ensure the regret-averse firms to produce more than the purely risk-averse counterparts and study the comparative statics of the optimal production. We also develop properties of regret-aversion on production by using a binary model. The findings in this paper are useful for production managers in their decisions on the production.

Original languageSpanish
Pages (from-to)157-161
Number of pages5
JournalEstudios de Economia
Volume46
Issue number2
DOIs
StatePublished - Dec 2019

    Fingerprint

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

Cite this