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Precautionary saving in the presence of other risks. (English) Zbl 1159.91418
Summary: Does the sign of the third derivative of the utility function with respect to wealth still govern precautionary saving motives in the presence of a background risk? This article shows that some other properties of the utility function have also to be considered depending on the serial correlation existing between the background risk and the future income risk.

MSC:
91B42 Consumer behavior, demand theory
91B30 Risk theory, insurance (MSC2010)
62H20 Measures of association (correlation, canonical correlation, etc.)
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