The Stock Market: Beyond Risk Lies Uncertainity

ENDNOTES

1

This is the title of what is perhaps the best-known chapter in Knight's book "Risk, Uncertainty, and Profit."

2

See Barnes (2001) for an article on this topic.

3

The baffling difference between survival and maximizing the expected value of final wealth is known as the St. Petersburg Paradox.

4

The data are from Ibbotson Associates (2002).

5

For a summary of the 1998 Survey of Consumer Finances, see Kennickell, Starr-McCluer and Surette (2000).

6

Revising up the subjective probability of tails coming up on the next flip after a run of heads is known as the gambler's fallacy.

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