Risk and Rank or Safety First Generalised
Bibliographic Data
| ID | 9723131 |
|---|---|
| Authors | A D Roy (corresponding author) |
| Year | 1956 |
| Volume | 23 |
| Issue | 91 |
| Pages | 214 |
| Publication date | 1956-08-01 |
| Peer Reviewed | Yes |
| Open Access | No |
| Type | ARTICLE |
| Venue | Economica (JOURNAL) |
| Journal identifiers | ISSN: 0013-0427 • E-ISSN: 1468-0335 |
| Publisher | JSTOR (PUBLISHER) |
| DOI | 10.2307/2551154 |
| OpenAlex | W2053800478 |
| Language | EN |
| Citations received | 3 |
A complete hypothesis about individual or corporate economic behaviour under uncertainty must specify three things. It must describe the way in which expectations are formed from experience of the hard facts of life, the objectives which the entity under examination is trying to achieve, and the opportunities which present themselves of attaining such ends. The whole corpus of probability and statistical theory represents the sustained efforts of mathematicians and philosophers to provide a rational basis on which expectations may be derived from past events. It is, however, an open question how far the ordinary man or business corporation derives a view of the future in a manner roughly approximating to that of accepted statistical methods. Nevertheless it is a convenient abstraction to assume that the man in the street's attitude is not notably different in kind from that of the practising statistician. In a recent article' I have suggested that a possible and plausible objective of an individual or a corporation is the attainment of the highest possible position in the distribution of income or profit appertaining to the society of which the person or firm is a member. The acceptance of such an aim implies the use of the distribution (or cumulative frequency) function of the expected distribution of income (or profit) as the utility function, the expectation of which is to be maximised. The purpose of the present article is a further pursuit of this scheme of ideas, particularly in relation to the likely set of opportunities with which an economic decision-making body may be confronted. In the course of this exploration the connection between the mode of behaviour now postulated and that which I have elsewhere2 called Safety First will be demonstrated. The formal resemblance between the present analysis and that based on the principle of Safety First enables certain methods, developed to expound the implications of the latter principle, to be conveniently adapted to a new purpose. The first task is to fashion the necessary tools and then to illustrate their application to a selection of simple economic problems
Actuarial science · Corporation · Distribution (mathematics) · Econometrics · Economics · Function (biology) · Mathematical economics · Microeconomics · Position (finance) · Positive economics · Profit (economics) · Rank (graph theory) · Statistician · Statistics · Complex Systems and Decision Making · Economic Theory and Institutions · Finance · Leadership, Behavior, and Decision-Making Studies · Mathematics
| Unique citing works | 3 |
|---|---|
| Citations per year | 0,19 |
| Citation span | 2010 - 2025 (16) |
| Citation velocity | recent |
| Highly cited | No |
| Citation types | Neutral: 2 |