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STUDIES IN THE THEORYOF RISK AND INSURANCEAChallenge tothe ConventionalWisdomKAILIN TUANPDGACKNOWLEDGEMENTThe publication of this bookis de possible througha financial contribution to Nankai Universityby theCIGNA International CorporationinPhiladelphia,USAPREFACERisk is uncertainty,and uncertainty is one of the fundamentalfacts of life.More than anyone else,I personally appreciate the deepmeaning of this axiom.In the Spring of 1949,I left Shanghai to Hong Kong and after asojourn there,continued to sail across the Pacific Ocean to San Fran-cisco.From there I traveled by train over the American continent toPhiladelphia.As planned,I started to pursue my graduate study atthe Wharton School of Finance &Commerce,University of Pennsyl-vania.I intended to stay there for a few years and after the completionof my study,I hoped to return to my native land with a youthful am-bition and mission for the reconstruction of China.Yet,the sunse-quent turn of events-the emergence of the new regie after the Chinemunists'triumph in the civil war and the Sino-American conflictbecause of the Korean war in 1950-had forced me to rein inAmerica far beyond a "sojourn"but for the whole life!Uncertainly but facing the reality,I have strived to overcome cul-tural barriers and difficulties during the ensuing years to pursue an a-cameic career in an alien environment to which I have gradually adapt-ed.By the late 1950s I have become the first and only Chinese (andan Asian)teaching the typical American subject-Insurance (not thestudy of risk and risk nagement yet)-in a typical American liberalarts college,the Upsala College (of Swedish heritage)in East Or-ange,New Jersey.In retrospect,I certainly enjoyed the serene life of a young collegeprofessor on a campus of suburban setting but close to the metropoli-I
