Asset Pricing Theory: Risk Aversion and Utility Functions

This lecture covers the concepts of risk aversion, utility functions, and asset pricing theory. It discusses the history of expected utility theory, the Allais Paradox, and classic utility functions like quadratic, logarithmic, and constant relative risk aversion. The lecture also delves into the Kreps-Porteus-Epstein-Zin utility function and its implications for separating risk aversion from the elasticity of intertemporal substitution.