Childhood Determinants of Risk Aversion: The Long Shadow of Compulsory Education

Dmytro Hryshko (), Maria Luengo-Prado and Bent Sorensen

No 2011-2, Working Papers from University of Alberta, Department of Economics

Abstract: We study the determinants of individual attitudes towards risk and,in particular,why some individuals exhibit extremely high risk aversion. Using data from the Panel Study of Income Dynamics we find that policy induced increases in high school graduation rates lead to significantly fewer individuals being highly risk averse in the next generation. Other significant determinants of risk aversion are age, sex, and parents' risk aversion. We verify that risk aversion matters for economic behavior in that it predicts individuals' volatility of income.

Keywords: schooling reforms; risk attitudes; intergenerational persistence (search for similar items in EconPapers)
JEL-codes: E21 I29 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2011-01-01
New Economics Papers: this item is included in nep-cbe, nep-lab and nep-upt
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Citations: View citations in EconPapers (72)

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Related works:
Journal Article: Childhood determinants of risk aversion: The long shadow of compulsory education (2011)
Working Paper: Childhood Determinants of Risk Aversion: The Long Shadow of Compulsory Education (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:ris:albaec:2011_002

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