Living in a Stochastic World and Managing Complex Risks

Dacorogna, Michel M and Kratz, Marie (2015): Living in a Stochastic World and Managing Complex Risks.

Abstract

In this paper, we review the concept of risk, its evolution in history and the big changes we experienced in the last 50 years. We conclude that peak risks are growing and the need for risk management is becoming a societal demand. Two phenomena are identified to render risks more complex, increasing interconnectedness of the world and faster time scale whereby actors have little time to adapt. We conclude in showing the complementary between qualitative and quantitative risk management.

• Item Type: MPRA Paper
• Language: English
• Keywords: complexity, crisis, extreme risk, fertility, life expectancy, resilience, risk management, (industrial, financial) risk, scientific approach, societal demand, uncertainty, urbanization
• Subjects: A - General Economics and Teaching > A1 - General Economics > A10 - General; Y - Miscellaneous Categories > Y2 - Introductory Material

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