risk avoidance


risk avoidance
An informed decision not to accept the *risks (and *rewards) of an activity or *market. Refraining from involvement in an activity or a market, or disengaging from existing commitments, can sometimes be a costly strategy, as it can involve significant *opportunity costs. At the end of the Korean War in 1953, for example, South Korea was one of the world’s poorest countries, with a *per capita *Gross Domestic Product comparable to India and Central Africa. The devastation of war had destroyed much of the country’s infrastructure and industrial base, but over the following decades the country’s rapid economic growth was little short of miraculous. By the 1990s, South Korea had become one of the most affluent countries in the world. International investors who accepted the risks of operating in war-devastated South Korea in its early years were rewarded during the subsequent economic boom, while those who initially avoided South Korea faced expensive entry costs as latecomers to a dynamic Asian "tiger" economy. Contrast *risk acceptance.

Auditor's dictionary. 2014.

Look at other dictionaries:

  • Risk management — For non business risks, see risk, and the disambiguation page risk analysis Example of risk management: A NASA model showing areas at high risk from impact for the International Space Station. Risk management is the identification, assessment,… …   Wikipedia

  • risk — {{Roman}}I.{{/Roman}} noun ADJECTIVE ▪ big, considerable, enormous, grave, great, high, huge, major, serious, significant …   Collocations dictionary

  • avoidance — avoid a‧void [əˈvɔɪd] verb [transitive] TAX LAW if you avoid tax, you manage to not pay it legally, for example by the way that you enter profits or losses into your accounts: • Investing in this way allows savers to avoid tax upon withdrawal.… …   Financial and business terms

  • risk management — The assessment, evaluation, and monitoring of *risks in an activity or organization, with the undertaking of necessary corrective actions. Risk management is a comprehensive process that aims to create a disciplined environment for the… …   Auditor's dictionary

  • risk elimination — The complete removal of a *risk. Unlike *risk avoidance, risk elimination does not necessarily imply nonengagement in (or disengagement from) an activity or *market. Risk elimination techniques can be costly. For example, an organization can… …   Auditor's dictionary

  • risk acceptance — An informed decision to accept the *risks (and *rewards) of an activity or *market. For example, the risks of operating in high technology markets can be extremely high, owing to the danger of rapid *product Obsolescence, but markets of this type …   Auditor's dictionary

  • avoidance — I (cancellation) noun abrogation, annulling, annulment, cancelling, cessation, discontinuation, dismissal, invalidation, making useless, nullifying, quashing, removal, rendering void, rescission, setting aside, vacating, vacation, voidance… …   Law dictionary

  • risk aversion — Attitudes toward *risk characterized by avoidance or minimization. Risk averse investors are deemed to have low *risk appetites they prefer certain but relatively low rates of *return over doubtful but higher rates of return. For example, an… …   Auditor's dictionary

  • avoidance — noun Avoidance is used before these nouns: ↑mechanism, ↑tactic Avoidance is used after these nouns: ↑conflict, ↑risk, ↑tax …   Collocations dictionary

  • Tax avoidance and tax evasion — Tax avoidance is the legal utilization of the tax regime to one s own advantage, in order to reduce the amount of tax that is payable by means that are within the law. By contrast tax evasion is the general term for efforts to not pay taxes by… …   Wikipedia