Risk Aversion and Portfolio Choice

James Tobin
John Wiley & Sons, Inc. | 1967

(Edited with Donald D. Hester)  This monograph is one of three (Monographs 19, 20, and 21) that bring together nineteen essays on theoretical and empirical monetary economics written by recent Yale graduate students and staff members of the Cowles Foundation. Seven of these are based on doctoral dissertations approved by the Yale Economics Department, supervised by Cowles Foundation staff members and other members of the Department.

The seven essays in Monograph 19, Risk Aversion and Portfolio Choice, have both normative implications. as pieces of advice to investors, and positive implications, as descriptions of the economy They are partly theoretical and partly empirical, They concern, on the one hand, the attitudes of investors toward risk and average return and, on the other, the opportunities which the market and the tax laws afford investors for purchasing less risk at the expense of expected return.