期刊名称：Discussion Papers / University of Leicester, Department of Economics
出版年度：2000
卷号：2000
出版社：Leicester
摘要：Wei n vesti gate th e ab i l i ty of expected uti l i ty theory to account f or si mul -
taneous gam bl i ng and i n su rance. C ontrary to a prev i ouscl ai m th at b orrow -
i ng and l endi ng i nperf ect capi tal m arkets rul es out a dem and f or gam bl es,
w e show that expected uti l i t ytheorywi th non- concave uti l i ty f uncti ons can
sti l lexpl ai n gam bl i ng. W hen the rates of i nterest and ti mepref erence are
equal , agents w i l l seek to gam bl eunl ess i ncom e f al l si na¯ni te set of ex-
cepti onalval ues. W hen these rates di ® er, there w i l lbe a range ofi ncom es
f or w hi ch gam bl es are desi red. In b oth cases rep eated gam b l i ng i snotex-
pl ai ned but m arket i mperf ecti onssuch asdi ® erent b orrow i ng and l endi ng
rates can account f or p ersi stentgam bl i ng provi ded the rates sp an the rate of
ti mepref erence.
