Moral hazard and Non-transferable risk: Difference between pages
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Non-transferable risks are risks which must be borne by an organisation. | |||
Non-transferable risks might be avoided or accepted and retained or reduced as appropriate. In the case of non-transferable business risks (which by definition are not avoided) it is important that the firm has a distinctive competence in the relevant areas. | |||
For example, a pharmaceutical company's non-transferable risks would include the risk that failure to gain approval for use of a new drug means that the research and development costs have been wasted. | |||
== See also == | == See also == | ||
* [[ | *[[Transferable risk]] | ||
Revision as of 08:16, 19 May 2015
Non-transferable risks are risks which must be borne by an organisation.
Non-transferable risks might be avoided or accepted and retained or reduced as appropriate. In the case of non-transferable business risks (which by definition are not avoided) it is important that the firm has a distinctive competence in the relevant areas.
For example, a pharmaceutical company's non-transferable risks would include the risk that failure to gain approval for use of a new drug means that the research and development costs have been wasted.
