Risk taking and sharing when risk exposure is interdependent

Abigail Barr, Trudy Owens and Ashira Perera ()
Additional contact information
Ashira Perera: School of Economics, University of Nottingham

No 2017-08, Discussion Papers from The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham

Abstract: Using a specially designed experiment, we investigate whether and how interdependence in risk exposure i.e., risk taking by some members of a potential risk sharing group affecting not only their own but also their co-members risk exposure, affects both risk taking and ex post sharing. The experimental subjects were Sri Lankan small-holders who face interdependent risk and share when neighbors fall on hard times in everyday life. We find that the Sri Lankan farmers reward socially responsible risk taking and, under some circumstances, punish socially irresponsible risk taking. Their behaviour is consistent with socially responsible risk taking being cost dependent, although, here, the statistical evidence is inconclusive. Finally, social responsibility in risk taking and ex post sharing do not appear to be substitutes, rather, they appear to be co-determined.

Keywords: behavioural experiment; risk-sharing; solidarity (search for similar items in EconPapers)
Date: 2017-08
New Economics Papers: this item is included in nep-cdm, nep-exp and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.nottingham.ac.uk/cedex/documents/paper ... on-paper-2017-08.pdf (application/pdf)

Related works:
Journal Article: Risk taking and sharing when risk exposure is interdependent (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:not:notcdx:2017-08

Access Statistics for this paper

More papers in Discussion Papers from The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham School of Economics University of Nottingham University Park Nottingham NG7 2RD. Contact information at EDIRC.
Bibliographic data for series maintained by Jose V Guinot Saporta ().