Multivariate Prevention Decisions: Safe Today or Sorry Tomorrow?
Posted: 19 Dec 2011 Last revised: 16 Apr 2018
Date Written: December 19, 2011
We study multivariate prevention decisions by disentangling early and late prevention. We show how the modularity of prevention and several measures of prevention efficiency interact with the agent’s risk attitude. We derive comparative statics with respect to impatience, loss severity, and income.
Keywords: prevention, decision-making under risk, intertemporal risk management
JEL Classification: D61, D81, D91
Suggested Citation: Suggested Citation