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Social comparison and risk taking behavior

Astrid Gamba (astrid.gamba@uninsubria.it) and Elena Manzoni

No 2014-001, Jena Economics Research Papers from Friedrich-Schiller-University Jena

Abstract: We study theoretically and experimentally decision making under uncertainty in a social environment. We introduce an interdependent preferences model that assumes that the decision maker evaluates monetary outcomes in relation both with his individual and his social reference point. In the experiment we reproduce a workplace environment whereby subjects interact in an effort task, earn (possibly) different wages from this task and then undertake a risky decision that may give them an extra bonus. Controlling for intrinsic risk attitudes, we find that both downward and upward social comparison strongly influence risk attitudes and that they both generate more risk loving behavior. Moreover, we find that a propension to envy counterposes such effect, by increasing risk aversion.

Keywords: Social comparison; risk aversion; interdependent preferences; reference point (search for similar items in EconPapers)
JEL-codes: C91 D03 D81 (search for similar items in EconPapers)
Date: 2014-01-29
New Economics Papers: this item is included in nep-cbe, nep-exp and nep-upt
References: Add references at CitEc
Citations: View citations in EconPapers (14)

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Related works:
Journal Article: Social comparison and risk taking behavior (2017) Downloads
Working Paper: Social Comparison and Risk Taking Behavior (2014) Downloads
Working Paper: Social comparison and risk taking behavior (2014) Downloads
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