The credit crisis that started in 2007, with the collapse of well-established financial institutions and the bankruptcy of many public corporations, has clearly shown the importance for any company entering the derivative business of modelling, pricing, and hedging its counterparty credit exposure.
Hedging is central to academic writing as it expresses possibility rather than certainty and collegiality rather than presumption. It is one means by which writers manage this pragmatic dimension of discourse and this text attempts to shed light on the use of hedging in published scientific papers.
Microeconomic Risk Management and Macroeconomic Stability
While the determinants of firms’ optimal hedging strategies on the micro level are well understood, there is rarely any literature dealing with macroeconomic consequences of microeconomic risk management. This book is concerned with the impact of diverse hedging policies on macroeconomic stability. It addresses this issue by employing theoretical as well as empirical methods.