Risk Advantages and Information Acquisition

Risk advantages and information acquisition

In some competitive situations under uncertainty, less risk averse competitors have an advantage over more risk averse opponents. Private information acquisition by the advantaged players diminishes this advantage by reducing the risk faced by their opponents in a Nash equilibrium. This tradeoff between risk advantages and informational advantages is examined in the context of a duopoly model w...

Risk Aversion, Information Acquisition, and Technology Adoption

We use a dynamic programming model to study the impacts of risk aversion on information acquisition in technology adoption decisions. In this model, the benefit of the technology is uncertain and, in each period, the decision maker (DM) may adopt the technology, reject the technology, or pay to acquire a signal about the benefit of the technology. The dynamic programming state variables are the...

Information Acquisition and Decisions under Risk and Ambiguity # 488

The working papers published in the Series constitute work in progress circulated to stimulate discussion and critical comments. Views expressed represent exclusively the authors' own opinions and do not necessarily refl ect those of the editors. Die Deutsche Bibliothek verzeichnet diese Publikation in der deutschen National-bibliografi e; detaillierte bibliografi sche Daten sind im Internet üb...

Information Acquisition and Decisions under Risk and Ambiguity

Information acquisition processes and their continuity: Transforming uncertainty into risk

We propose a formal approach to the problem of transforming uncertainty into risk via information revelation processes. Abstractions and formalizations regarding information acquisition processes are common in different areas of information sciences. We investigate the relationships between the way information is acquired and the continuity properties of revelation processes. A class of revelat...