Search results for "Risk matrix"

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Manager’s and citizen’s perspective of positive and negative risks for small probabilities

2011

So far „risk‟ has been mostly defined as the expected value of a loss, mathematically PL, being P the probability of an adverse event and L the loss incurred as a consequence of the event. The so called risk matrix is based on this definition. Also for favorable events one usually refers to the expected gain PG, being G the gain incurred as a consequence of the positive event. These “measures” are generally violated in practice. The case of insurances (on the side of losses, negative risk) and the case of lotteries (on the side of gains, positive risk) are the most obvious. In these cases a single person is available to pay a higher price than that stated by the mathematical expected valu…

Risk matrix Risk sustainability Managerial perspective Social perspectiveSettore SECS-S/02 - Statistica Per La Ricerca Sperimentale E Tecnologica
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Rethinking the risk matrix

2011

So far risk has been mostly defined as the expected value of a loss, mathematically PL (being P the probability of an adverse event and L the loss incurred as a consequence of the adverse event). The so called risk matrix follows from such definition. This definition of risk is justified in a long term “managerial” perspective, in which it is conceivable to distribute the effects of an adverse event on a large number of subjects or a large number of recurrences. In other words, this definition is mostly justified on frequentist terms. Moreover, according to this definition, in two extreme situations (high-probability/low-consequence and low-probability/high-consequence), the estimated risk…

Settore SECS-S/02 - Statistica Per La Ricerca Sperimentale E TecnologicaRisk matrix Risk & sustainability Managerial perspective of risk Social perspective of risk
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