Changing Risk Preferences at Older Ages

James Banks (), Elena Bassoli () and Irene Mammi
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James Banks: Institute for Fiscal Studies and University of Manchester
Elena Bassoli: Department of Economics, Ca' Foscari University of Venice

No 2019:01, Working Papers from Department of Economics, University of Venice "Ca' Foscari"

Abstract: This paper investigates risk preference at older ages in 14 European countries. Older individuals report greater risk aversion. Using the longitudinal nature of the data we are able to show this relationship between risk preferences and age is not due to cohort effects or selective mortality. We also show, however, that on average roughly forty percent of this overall age effect is actually due to life events such as retirement, health shocks and widowhood or marital change that occur increasingly as individuals age. These life events are a particularly important explanation of the age `effect' for women and for the age group 50-64.

Keywords: Risk attitude; ageing; health status; life-related events; SHARE (search for similar items in EconPapers)
JEL-codes: D81 D90 D91 (search for similar items in EconPapers)
Pages: 49 pages
Date: 2019
New Economics Papers: this item is included in nep-age, nep-eur, nep-hea, nep-rmg and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ven:wpaper:2019:01

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