Risk aversion under preference uncertainty

We show that if an agent is uncertain about the precise form of his utility function, his actual relative risk aversion may depend on wealth even if he knows his utility function lies in the class of constant relative risk aversion (CRRA) utility functions. We illustrate the consequences of this result for asset allocation: poor agents that are uncertain about their risk aversion parameter invest less in risky assets than wealthy investors with identical risk aversion uncertainty. Keywords: Risk Aversion , Preference Uncertainty , Risk-taking , Asset Allocation JEL Classification: D81, D84, G11 This Version: November 25, 201

The Effect of the Theo van Gogh Murder on House Prices in Amsterdam

This paper estimates the impact of the murder of film maker Theo van Gogh on November 2, 2004, on listed house prices in Amsterdam with a unique dataset. We use an hedonic-market approach to show that general attitudes towards Muslim minorities were negatively affected by the murder. Specifically, we test for an effect on listed house prices in neighborhoods where more than 25% of the people belong to an ethnic minority from a Muslim country (type I). Relative to the other neighborhoods, house prices in type I neighborhoods decreased by on average 3%, with a widening gap over time. The results are robust to several adjustments including changes in the control group. There is no significant difference in the time it takes for houses to be sold in type I versus other neighborhoods. Finally, people belonging to the Muslim minority were more likely to buy and less likely to sell a house in a type I neighborhood after the murder than befor

The Middle: The middle class as the moral core of society

For the first time in history, more than half of the world’s population belongs to the middle class. Global poverty has declined rapidly due to globalisation and technological development. But the same trends also lead to rapid change and the feeling that society is moving away from its moral core. In this book, the middle class in the Netherlands and Europe is highlighted by several authors and from several points of view. How is the middle class doing? What problems do families experience? What power lies in the civil society? And what does this mean for politics