Risk Analysis in Theory and Practice

“Risk is at the very core of most decisions. This text beautifully explores the classical theory of choices under uncertainty including major applications and recent extensions. It combines usefulness, thoroughness, and clarity.”
— Christian Gollier, Professor of Economics, University of Toulouse

“Professor Chavas is one of the leading scholars in and premier teachers of applied risk analysis. This masterful book provides a rigorous, accessible and wide ranging treatment of the key concepts and tools. It is a “must read” for anyone seriously interested in the economics of risk, uncertainty and information.”
— Christopher B. Barrett, Professor, Department of Applied Economics and Management, Cornell University

Risk Analysis in Theory and Practice 1st Editionpresents an analytical framework and illustrates how to use it to investigate economic decisions under risk. In a sense, the economics of risk is a difficult subject: it involves understanding human decisions in the absence of perfect information. How do we make decisions when we do not know some of events affecting us? The complexities of our uncertain world and of how humans obtain and process information make understanding difficult. In spite of these difficulties, much progress has been made.

Jean-Paul Chavas provides a systematic treatment of both private and public decisions under uncertainty taking into consideration crucial factors including risk assessment using probability theory, risk measurement, risk preferences, and new insights into the value of information.

ABOUT THE AUTHOR
Jean-Paul Chavas is a professor in the Department of Agricultural and Resource Economics at the University of Maryland.