Biased survival expectations and behaviours: Does domain specific information matter?

Joan Costa-Font and Cristina Vilaplana-Prieto
Additional contact information
Cristina Vilaplana-Prieto: Universidad de Murcia

Journal of Risk and Uncertainty, 2022, vol. 65, issue 3, No 3, 285-317

Abstract: Abstract We study the formation of biased expectations across domains and examine whether they have a unique influence on health and financial behaviors. Combining individual-level longitudinal, retrospective, and end of life data from several European countries for more than a decade, we estimate the time-varying individual level bias in ‘survival expectations' (BSE) and compare it to a similar type of bias in the formation of ‘meteorological expectations' (BME). We exploit the variation across individual's family history (parental age at death) to evaluate the causal effect of BSE on health and financial behaviors, and we compare it to the effect of BME. This allows to investigate whether the BSE effect is due to private information, or another mechanism. We find that BSE increases the likelihood of engaging in less risky health and financial behaviors. We estimate that a one standard deviation increase in BSE reduces the average individual probability of smoking by 48% (and increase the probability of holding retirement accounts by 69%). In contrast, BME has little effect on healthy behaviors, and is only associated with a change in some financial behaviors.

Keywords: Biased expectations; Survival expectations; Meteorological expectations; Longevity optimism; Private information; Health behaviours; Financial behaviours; I18; D14; G22 (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)

Downloads: (external link)
http://link.springer.com/10.1007/s11166-022-09382-z Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Biased survival expectations and behaviours: does domain specific information matter? (2022)
Working Paper: Biased Survival Expectations and Behaviours: Does Domain Specific Information Matter? (2021)
Working Paper: Biased Survival Expectations and Behaviours: Does Domain Specific Information Matter? (2021)
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:kap:jrisku:v:65:y:2022:i:3:d:10.1007_s11166-022-09382-z

Ordering information: This journal article can be ordered from
http://www.springer. ... ry/journal/11166/PS2

DOI: 10.1007/s11166-022-09382-z

Access Statistics for this article

Journal of Risk and Uncertainty is currently edited by W. Kip Viscusi

More articles in Journal of Risk and Uncertainty from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().