International trade and firms' attitude towards risk

dc.contributor.author	Broll, Udo
dc.contributor.author	Mukherjee, Soumyatanu
dc.date.accessioned	2017-03-27T10:19:53Z
dc.date.available	2017-03-27T10:19:53Z
dc.date.issued	2017
dc.identifier.uri	http://hdl.handle.net/2259/925
dc.description	Economic Modelling 64 (2017) 69–73	en_US
dc.description.abstract	This paper examines the optimal production and trade decisions of the domestic firms facing uncertainties owing to the exchange rate volatility under mean-variance preferences. The impact of uncertain exchange rate fluctuations on trade is evaluated in a partial equilibrium framework, using the concept of risk-aversion elasticities. These elasticities measure how sensitive the firms are towards substituting between return and risk at the margin, with respect to changes in the distribution of the spot exchange rate. This simplest possible analytical framework is useful for explicit empirical estimation of risk-aversion elasticities in the literature of international economics.	en_US
dc.language.iso	en	en_US
dc.publisher	Elsevier: Economic Modelling	en_US
dc.subject	Two–moment decision model	en_US
dc.subject	Imported intermediate input	en_US
dc.subject	Export	en_US
dc.subject	Exchange rate risk	en_US
dc.subject	Risk–aversion elasticity	en_US
dc.title	International trade and firms' attitude towards risk	en_US
dc.type	Article	en_US