Rozhodování o výběru projektu v rámci komplexního rizika
Decision-making on Project Selection in Context of Comprehensive Risk

Summary/Abstract: The contribution extends the standard economic risk of an investment for a non-economic component, being a political or environmental risk (wars, expropriation, sanctions, natural disasters, etc.), by means of which it changes from the investment risk into the comprehensive risk. The aim of this paper is to demonstrate how the transition from investment risk to comprehensive risk changes standard decision criteria for project acceptance. Methodologically, the non-economic risk of the project investment is conceived as the risk of a bet in the investment lottery, differentiating from the standard lottery only by the low probability not to win anything. From such a modified investment lottery model a new general condition of project acceptability is derived; a general condition is also derived for the case of decision-making between two projects with equal net present value and various non-economic risks. The newly formulated conditions of acceptability define the basic decision-making rules for project selection burdened by non-economic risk. General conclusions, accompanied by relevant commentaries, are applied in a specific case study.

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