How Bonus Deferral Changes Risk Taking

6533b86ffe1ef96bd12ce61e

RESEARCH PRODUCT

How Bonus Deferral Changes Risk Taking

subject

Actuarial science Risk aversion Value (economics)Economics Asset (economics)Deferral Risk taking

description

We characterize continuous-time risk taking and show that the introduction of deferral increases risk taking at any time when the realized asset value is large or small. For realized asset values in-between we derive the parameterizations of deferral for which risk taking decreases and discuss trade-offs in setting the deferral parameters.

year	journal	country	edition	language
2012-01-01	SSRN Electronic Journal

https://doi.org/10.2139/ssrn.1662555

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