Explaining the Characteristics of the Power (CRAA) Utility Family.

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Abstract

The power family, also known as the family of constant relative risk aversion (crra), is the most widely used parametric family for fitting utility functions to data. Its characteristics have, however, been little understood, and have led to numerous misunderstandings. This paper explains these characteristics in a manner accessible to a wide audience.
Original languageEnglish
Pages (from-to)1329-1344
Number of pages1329
JournalHealth Economics
Volume17
Issue number16
DOIs
Publication statusPublished - 1 Jan 2008

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