Risk and Entrepreneurship (VWL-MiFi-RiEn) - IfW (030220)- Dozent/in
- Prof. Aoife Hanley, Ph.D.
- Angaben
- Vorlesung, 2 SWS, ECTS-Studium, ECTS-Credits: 5
für ERASMUS-/Austauschstudierende geeignet, Unterrichtssprache Englisch, Klausur am Ende des Semesters
Zeit und Ort: Di 8:15 - 9:45, CAP2 - Hörsaal D
vom 16.4.2024 bis zum 2.7.2024
1. Prüfungstermin (Klausur am Ende der Vorlesungszeit eines Semesters): 15.7.2024, 14:00 - 15:30 Uhr, Raum Online-Klausur
Bemerkung zu Zeit und Ort: Die erste Vorlesung findet am 16.04.2024 statt.
- Voraussetzungen / Organisatorisches
- Module Code: VWL-MiFi-RiEn
Module Number: 320700
Exam Number: 16310
Section in the curriculum of Bachelor Volkswirtschaftslehre (FPO 2021): Wahlpflichtbereich Volkswirtschaftslehre - Mikroökonomik und Finanzwissenschaften (MiFi)
Exam type according to FPO: Module Exam (Modulprüfung)
Specific exam type in summer term 2024: online exam
Further Information: See OLAT
The number of ECTS Credits as well as the admission to the examination for this module is determined by the information regarding this module in the FPO (Examination Regulations) of your program. If this module is not explicitly listed in your FPO, please check at the beginning of the semester about admission options. An overview for all programs which can choose modules of the Institute of Economics can also be found here: Nebenfach Volkswirtschaftslehre Handbuch für Exportmodule (Minor in Economics - Handbook of Export Modules). You can also check in advance in QIS whether you can find this module listed there in the overview for exam registration, with the exam number mentioned in UNIVIS. Registration to the exam is only possible during the registration period. If you still have questions after reviewing these documents, please contact your student advisor (Studienfachberater).
- Inhalt
- For Introduction, see Lecture 1 on OLAT website (podcast)
Course content
The students learn how individuals take decisions under uncertainty. We use standard models from decision theory (e.g. Expected Utility Theory). We also apply more recent experimental evidence to reveal how these models can break down, when attempting to describe real behaviour such as framing and loss aversion.
But, entrepreneurs are individuals too. The risk of entrepreneurs failing is especially high, as students learn from various studies on firm failure. Additionally, investment decisions such as R&D spending, is also surrounded by uncertainty. We learn how entrepreneurs carve out markets for themselves, where risk of failure is lowest.
Other agents, such as banks, also have a role to play. Students learn how these agents seek to reduce their risk exposures through credit scoring.
1. Theory of choice under uncertainty
- The von Neumann-Morgenstern (NM) Model
- Spreading risk: diversification scenario
- Entrepreneurs: risk loving?
- Exercises
2. Criticisms of the NM Model
- Allais and Ellsberg paradoxes
- Framing, Heuristics
- Application: Deal or No Deal experiments
- Exercises
3. Market Entry
- Motivations for entrepreneurship (endogenous entrepreneurship, DNA, biased profit expectations)
- Empirical evidence for different models
4. Firm survival risk
- Hazard survival model
- Factors affecting survival
- Exercises: Cataloging most important aspects of business survival/failure from Munich Foundation Survey (Brüderl et al, ASR)
5. Enterprise credit and risk
- Theory of credit rationing
- Are start-ups debt rationed?
- Credit scoring
- Empfohlene Literatur
- Topic 1
- Frank, R, Microeconomics and Behavior, International Edition, Irwin, McGraw Hill
Topic 2
- Post, T et al., 2009, 'Deal or No Deal? Decision Making under Risk in a Large-Payoff Game Show ', American Economic Review, Vol. 98, No. 1, March 2008
Topic 3
- Evans, D. and L. Leighton, 1989, Some empirical aspects of entrepreneurship',
- American Economic Review, v79, pp.519-535
- Parker, S., 1996, 'A Time Series Model of Self-employment under Uncertainty', Economica, New Series, v63, nn 251 , pp. 459-475
- Blanchflower, D. and A. Oswald, 1998, 'What Makes an Entrepreneur? ', Journal of Labor Economics, 1998, vol. 16, no. 1
- Arabsheibania, G., D. de Meza, J. Maloney and B. Pearson, 2000, 'And a vision appeared unto them of a great profit: evidence of self-deception among the self-employed', Economics Letters, v67, n1, pp. 35-41
Topic 4
- Agarwal, R. and D. Audretsch, D. (2001), 'Does entry size matter? The impact of the life cycle and technology on firm survival', The Journal of Industrial Economics, v49 pp.21-43.
- Audretsch, D., 1991, 'New firm survival and the technological regime', Review of Economics and Statistics, 73, 441-450
- Mata, Jose & Portugal, Pedro, 1994. 'Life Duration of New Firms', Journal of Industrial Economics, v2(3), pp227-45
Topic 5
- Greenbaum and Thakor, Contemporary Financial Intermediation, 1995, Chapter 6 (section on lending to small business start-ups)
- Frank, R, Microeconomics and Behavior, International Edition, Irwin, McGraw Hill (explanation of 'lemons's problem')
- Cavalluzzo, K. and L. Cavalluzzo , 1998, 'Market Structure and Discrimination: The Case of Small Businesses', Journal of Money, Credit & Banking, v30, n4
- Freel, M., 2006, Are small innovators credit rationed?', Small Business Economics, v28, pp.23-35
- Thomas, L., D. Edelman and J. Crook, 2002, Credit scoring and its applications', textbook
- Zusätzliche Informationen
- Erwartete Teilnehmerzahl: 100
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