Gender differences in risk behavior and the link to household effects and individual wealth

Ling Yee Khor, Orkhan Sariyev and Tim Loos

Journal of Economic Psychology, 2020, vol. 80, issue C

Abstract: This study examined the differences in risk behavior between men and women using a household survey that captured the risk preferences of two members in a household and recorded wealth at the individual level instead of the usual approach of representing wealth at the household level. After controlling for commonly used explanatory variables, such as gender, education, age, and wealth, household fixed effects explain about 15% of the variation in risk behavior. This highlights the magnitude of household effects in shaping one’s risk behavior. In general, females in the study area are more risk averse than males based on a risk game with real payout. The gender differences disappear when focusing on only the top land owners. However, even in those cases, females consider themselves more risk averse, supporting results from previous studies that link culture and societal norms to the gender differences in risk behavior.

Keywords: Risk tolerance; Gender differences; Conformity; Individual wealth; Household effects (search for similar items in EconPapers)
JEL-codes: D31 D81 D90 O13 Q12 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:joepsy:v:80:y:2020:i:c:s0167487020300234

DOI: 10.1016/j.joep.2020.102266

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