Linking measured risk aversion to individual characteristics

Joop Hartog, Ada Ferrer-i-Carbonell, Nicole Jonker

Research output: Contribution to journalArticlepeer-review

324 Citations (Scopus)

Abstract

From the stated price of a specified lottery in three unrelated surveys we deduce individuals' Arrow Pratt measure of risk aversion. We find that risk aversion indeed falls with income and wealth. Entrepreneurs are less risk averse than employees, civil servants are more risk averse than private sector employees, and women are more risk averse than men. A simple lottery question appears a promising survey instrument to explore risk attitude and its relation to personal characteristics.
Original languageEnglish
Pages (from-to)3-26
Number of pages24
JournalKyklos
Volume55
Issue number1
DOIs
Publication statusPublished - 2002
Externally publishedYes

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