Abstract
It is important to understand that with the existence of structural risk, risk no longer costs the same for all risk owners. Again, this is a point where the properties of the structural risk cost strongly challenge the leading academic view of risk because the conclusion stating that risk does not cost the same for everybody means that risk owners with low reserve capital and a low level of insurance have higher risk costs. Risk owners with low reserve capital and a low level of insurance are simply not competitive when it comes to assuming risk.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Author information
Authors and Affiliations
Rights and permissions
Copyright information
© 2017 The Author(s)
About this chapter
Cite this chapter
Jensen, J.L., Sublett, S. (2017). The Different Costs of Risk. In: Redefining Risk & Return. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-41369-3_8
Download citation
DOI: https://doi.org/10.1007/978-3-319-41369-3_8
Published:
Publisher Name: Palgrave Macmillan, Cham
Print ISBN: 978-3-319-41368-6
Online ISBN: 978-3-319-41369-3
eBook Packages: Economics and FinanceEconomics and Finance (R0)