Re: poly: Modeling Economic Singularities

Carl F. asks:
>>a = typical risk-aversion, ~1 (a = -c*u''/u' for utility u(c)).
>
>Eh? I don't understand this equation ...

c = a rate of consumption,
u(c) = the utility one gets from such a consumption rate
u'(c) = the first derivative of u
u''(c) = the second derivative of u

        - c u''(c)
a = ------------
            u'(c)

That help?

Robin Hanson
hanson@econ.berkeley.edu http://hanson.berkeley.edu/
RWJF Health Policy Scholar, Sch. of Public Health 510-643-1884
140 Warren Hall, UC Berkeley, CA 94720-7360 FAX: 510-643-8614
Received on Thu Mar 26 21:54:57 1998