Risk compensation

As with wearing a seat belt, should someone choose not to wear a helmet, they are only putting themselves in danger. Helmets may enable some riders to take more risks while riding. Taking more unnecessary risks is a common concept known as a moral hazard or risk compensation. With all safety devices, across a wide variety of applications this problem exists. Many people believe they are safe with their existing safety precautions and continue to take greater and greater risks. An article written by the British Medical Journal, shortly after a universal seat belt law was passed in 1983, explores this concept. “In its general form the risk compensation hypothesis suggests that the introduction of any safety measure results in changes of the behaviour of road users which may negate the supposed benefits of the measure”…

The argument that seat-belts can increase our safety, potentially save lives and therefore any wise individual should take precaution and buckle up is a valid one, but by making this a mandatory law, we are in essence opening the door for our government to further infringe upon our right to decide what we will or will not individually do to insure our personal well-being. Could government regulation of food consumption come next, with fines for those who overeat and put themselves at far greater…

My goal is to persuade you that seat belt laws are a prime example of government overstepping its bounds, chipping away at our right to freedom, and generating revenue in the process. Anything you do in life contains some element of risk. Sensible people understand that and act accordingly, because most people do not want to be a casualty. Adult drivers should know the probability of risk in driving, and be able to make their own choices as to how best to handle the situation. The points that…

Flames swarm around him, taking away his supply of oxygen one small breath at a time. He’s trying to unbuckle his seatbelt, but it’s jammed shut. He screams for help, yet the roaring of the flames drown out the sound of his voice. People stand by wanting to help, but fearing for their lives, as the car may explode any second. When the Police and Firefighters arrive they were too late he had been burnt to death. This scene that many Americans experience across the states and has scarred them for…

Lillian Bonine Mrs. King ELA 8th hour 07 April 2017 Seat belt importance Can seat belts really save you life? People are losing their lives everyday and costing billions to themselves and their government because they are making the decision to not wear their seat belt. So, the seat belt law to continue to be enforced. According to some statistics people that don’t wear seatbelts are at higher risk of injury in car crashes and are more likely to lose their life. Kathyrn O'Leary Higgins…

Liability to employees and workers compensation liability are critically important parts for your company. These liabilities are defined as “coverage for an employer's two key exposures arising out of injuries sustained by employees.” This section of insurance coverage is commonly divided into two parts. The first part encompasses the employer's responsibilities under workers compensation laws, while the second part of the coverage handles the liability that results from employees' work-related…

There are two main approaches of justifying CEO compensations. The first would be to justify high CEO compensations from a business or a managerial perspective. In other words, we would need to justify the pay-gap between chief executives and ordinary workers. The second would be to justify high CEO compensations from an economic perspective. An economic lens takes into account the rising economic inequalities, which is largely assumed to be non-existent or insubstantial in the first method, as…

90% of Easterbrook’s compensation is at risk, being based on performance. In 2014, 93% of shareholders supported the approach for executive compensation. In the appendix, a pie chart provides the detail of CEO compensation. The five sections are salary, STIP (operating income growth), LTIP (return on incremental invested capital), options (share price), and RSUs (earning per share). We believe the risk-reward basis of the compensation structure is appropriate. With 90% of Easterbrook’s…

failed) to pass workers’ compensation acts. Wisconsin passed the first comprehensive workers’ compensation law in 1911, where Mississippi was the last state to in 1948. These early laws had required employers to provide medical and wage replacement benefits for injured workers. If the injured employee had accepted…

Understanding the cross-section of equity market returns has been one of the most researched topics in finance for many years. The Capital Asset Pricing Model (CAPM), introduced by Sharpe (1964), Lintner (1965) and Black (1972), states that there is a linear relation between beta (systematic risk) and expected stock returns and that beta is sufficient to explain the variation in expected returns. The validity of the CAPM, however, has been questioned by many empirical studies which have provided…