Profits under Conditions of Uncertainty. Academic Article uri icon

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abstract

  • The objectives of this paper are to (1) show that the extensive post WW II literature on the theory of the firm under uncertainty contains an implicit theory of factor demand that generates "uncertainty profits"; and (2) investigate how variations in state variables affect the expected value of these profits. The main conclusions are that the expected value of such profits changes with variations in state variables in a manner that is consistent with Knight's conclusions with regard to risk profits. Copyright 1992 by Blackwell Publishers Ltd/University of Adelaide and Flinders University of South Australia

publication date

  • December 1992