Risk-taking and others

Annika Lindskog, Peter Martinsson and Haileselassie Medhin

Journal of Risk and Uncertainty, 2022, vol. 64, issue 3, No 3, 287-307

Abstract: Abstract Real-life risk decisions are taken in a social context. However, we still know little about how that affects risk decisions. We have experimentally investigated the effect of social comparison on risk taking. We designed an experiment that allows us to isolate social comparison from other channels whereby the social context can affect risk decisions. The design also allows us to find impacts of the social reference point both if the individual cares about the distance to the social reference point and if she cares about her rank. Thus, we compare risk-taking in isolation to risk-taking with various exogenously imposed social reference points. We find that risk-taking is affected by the desire to get ahead of others, both when the social reference point is within reach (rank can be affected) and when it is out of reach (rank cannot be affected). Our results suggest that people do not only care about rank but also care about the distance to the social reference point.

Keywords: Risk; Social reference point; Status; Envy; Experiment (search for similar items in EconPapers)
JEL-codes: C91 D03 D81 I30 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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DOI: 10.1007/s11166-022-09376-x

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