Overview
The field of the economics of uncertainty and the economics of information has been growing in recent years, as many leading economists explore the importance of uncertainty in risk analysis. Established now as a key element of modern economic research, uncertainty is commonly regarded as an essential ingredient of economic analysis. The Economics of Uncertainty provides a clear, concise, and largely non-technical introduction to the subject that is suitable for use at all levels. McKenna outlines the broad issues and various techniques, and then considers applications to such topics as insurance, product quality, signalling, and the stock market. As the author demonstrates, accounting for risk in uncertainty not only means reexamining minor assumptions, but often requires a complete rethinking of many crucial questions about the functioning of the economy.