BUSS 5292 Topic 3 Sources of Risk 代写

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    Risk Management
    BUSS 5292
    Topic 3
    Sources of Risk:
    From nature to nurture
    Course Facilitator: Kesten Green
    Study Period 1, 2016
    Risk is all around us…
    q Natural physical environment (“act of God”)
    (e.g. toxins, meteorological, geophysical)
    q Natural living environment (fauna & flora)
    (e.g. toxins, allergens, diseases, wildlife, tree fall, wildfire)
    q Manmade physical environment
    (e.g. by-products, flaws, failures (leakages & collapses))
    q Own genetics and actions
    (e.g. disease, mistakes, mishaps, misadventure)
    q Social environment
    (e.g. mistakes, mishaps, misadventure, misinterpretation,
    misrepresentation, negligence, malpractice, fraud,
    malinvestment, malfeasance, maladministration, corruption,
    crime, terrorism, war)
    So what’s to worry about?
    q Long-standing well-known easily-
    quantified* risks
    (e.g. from natural world, own actions, and social
    q Speculative harder-to-quantify risks
    (e.g. from human productive activities, and from
    government statements and actions)
    *Data are available on frequencies of occurance and
    size of impact.
    How to quantify risk
    q Identify relevant data sources*
    q Relative frequency, e.g.
    q “Causes of death, 2013”
    q “...falling trees..”
    q victimisation rates
    q bankruptcies
    q business failures
    q share market prices
    q Impact, e.g.
    q lives lost
    q dollar values
    q Calculate probabilities and expected values
    *See example resources under Topic 3.
    What about harder-to-quantify risk?
    q Look to objective studies*
    q Experiments
    q Replications
    q Meta analyses
    q Look to analogous data*
    q Similar situations that occurred in the past
    *See the following example resources under Topic 3
    that are objective studies that also provide analogous
    data: “But is it true?”; “Hyping health risks”; “Bad
    environmental and resources scares”; “Extraordinary
    popular delusions”
    Examples of speculative health risks*
    q Evironmental causes of breast cancer
    q Electromagnetic fields
    q Residential radon
    q Passive smoking
    *See Kabat (2008)
    6  BUSS 5292 Topic 3 Sources of Risk 代写
    Examples of environmental scares*
    q DDT
    q Acid rain
    q Agent orange
    q Love Canal
    q Mercury in fish
    q Asbestos
    q Etc...
    *See Simon; Wildavsky
    Examples of resource scares*
    q e.g. Peak oil
    q Timber famine
    q Copper crises
    *See Simon (1998)
    US Shale Resources
    Source: Federation of American Scientists
    4  BUSS 5292 Topic 3 Sources of Risk 代写
    Examples of risky grand schemes*
    q Tulip mania
    q The Mississippi company
    q South Sea bubble
    q etc.
    *Mackay (1852)
    Examples of travel risk (mis?)calculation*
    q Travel deaths after September 11, 2001
    q Fear of “dread risk” leads to more deaths
    q Estimated extra deaths on road: 1,500
    *See Gigerenzer (2006); chart on p. 349
    Risky investments and “beating the market”*
    q Do stock pickers outperform the
    sharemarket average?
    q No.
    q So how do you manage risk as an investor?
    q Buy a broad index fund with low fees.
    *See interview with Burton Malkiel, author of
    “A random walk down Wall Street”
    What are business leaders worried about, now?
    CEO responses to
    PwC on what they
    consider the top
    threats to business
    growth. Photograph:
    BUSS 5292 Topic 3 Sources of Risk 代写