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Showing 1-10 of 11 reviews(Verified Purchases). See all 16 reviews
on September 7, 2016
This is one of the most important books on economics written in the 20th century. Frank Knight was tasked by his PhD advisor to sort out the differences between risk and uncertainty and how they related to entrepreneurship and firm management. He did. Nobody has surpassed this treatment in the century since Frank Knight penned it in 1917 as his doctoral dissertation. This is verbal treatment of the subject, not a mathematical treatise. The argument is sound, but often subtle. The current volume that I am reviewing is the sixth or seventh time I have read the book and, as always, I found something new to take away. I teach entrepreneurship to undergraduates and to graduate students and i enjoy bringing Knight's insights into the classroom.
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on February 24, 2017
I have to admit this was a hard book to read. Partly because of the old fashioned language, but largely because it challenges popular beliefs that have continued to plague economics since the time of this writing almost a century ago.

The mental rigor demonstrated by the author is extraordinary in presenting a working model of the social world we live in; tying economics, epistemology and politics together.

This is not light-reading, but the effort is justified for anyone interested in the workings of the socio-economic fabric of our society.
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on October 8, 2013
After reading Rita Gunther McGrath's "End of Strategy" and re-reading Drucker's "Innovation and Entrepreneurship" it became clear to me they are both talking about "uncertainty". Not the kind that can be quantified with a probability distribution (and hence insured against) but the kind that cannot. Which brought me to Frank Knight and his analysis of the relationship among risk, uncertainty and profits. It is an excellent book and very rewarding to read - but the early 20th century style of prose is hard to read and requires quite a bit of concentration.
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on November 23, 2004
Knight's Risk,Uncertainty and Profit(RUP) is a classic work ,especially with respect to Knight's analysis of the distinction between risk and uncertainty and the role each plays in the decision making calculus of the entreprenuer or the firm.For instance,Knight recognized that the negative impact of uncertainty could be reduced for those firms that were able to increase their size and get larger and larger over time.Advertising would allow firms to deal with the uncertainty of consumer responses to the introduction of new products over time ,as well as to changes in consumer preferences.Knight was the first to clearly recognize that economic profit is the return to the successful entreprenuer or owner of the firm to compensate them for the bearing of uncertainty.Knight's analysis of the connection between uncertainty and economic profit corrected the errors of Ricardo and Marx,who regarded economic profit as an unearned surplus .Keynes's integration of expected economic profit into the specification of his aggregate supply function,Z,where Z =P+wN(P equals expected economic profit),can be traced back to Knight's earlier discussions.It is strange that economists still are having trouble specifying Keynes's Z function nearly 70 years after the publication of the General Theory in 1936.However,Knight's theoretical analysis of uncertainty at both the micro and macro level is not as impressive as Schumpeter's analysis of uncertainty in his Theory of Economic Development(1912)or of the path breaking analysis of John Maynard Keynes in chapters 6 and 26 of the A Treatise on Probability(1921).In this latter book,Keynes operationalized a quantitative method of dealing with uncertainty(insufficient weight of the evidence,w)by means of his conventional coefficient of risk and weight,c.This coefficient allows a decision maker to incorporate uncertainty and nonadditive probabilities into a technical analysis of decision making.The only author who comes close to Keynes is D.Ellsberg with his practically identical index to measure ambiguity called rho.There are still some unanswered questions that can be asked in this area of economic thought.Why didn't Knight cite the earlier work of Joseph Schumpeter on the risk versus uncertainty distinction?Further,why didn't Keynes cite both Knight and Schumpeter in his chapters 12 ,17 and 22,where he discussed the issue of the effect of uncertainty on investment in new capital goods and on stock market speculation?
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on November 18, 2013
I am about halfway through this book and I'm enjoying it as much as ayone who enjoys books they HAVE to read for school.

But - it's important to note Knight is a genius and he makes several points in this book.
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on January 8, 2017
This is a masterwork of economic theory. I have read it a number of times and now am rereading it on my Oasis. It builds from a few simple assumptions, but the author constantly reminds us that it is a useful guide to examining the real world but is not a description of the real world.
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on October 25, 2014
Powerful footnotes. I keep getting lost in them. One of these days I'll get around to reading the book without getting sidetracked. This book is a bit of a stretch for me. It was originally written as a Ph.D. dissertation in economics. Definitely worth the effort.
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on October 16, 2016
A classic
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on March 29, 2015
A classic
The more the market changes, the more it remains the same
Get this book and read it
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on November 20, 2012
The author is expertly informed, and yet presents the concepts and data so that a layperson can follow the principles and even extrapolate how they apply to and can be employed in his or her own life.
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