Portfolio choice and risk attitudes: a household bargaining approach

Tansel Yilmazer and Stephen Lich ()

Review of Economics of the Household, 2015, vol. 13, issue 2, 219-241

Abstract: The goal of this study is to understand how the households decide on portfolio asset allocation when the husband and wife have different risk preferences. Using data from the Health and Retirement Study for 1992–2006, we show that the share of risky assets in portfolios of two-person households increases with the risk tolerance of the spouse who has more bargaining power. The risk tolerance of the spouse who has less bargaining power does not seem to affect the share of household wealth allocated to risky assets. These results are consistent with a cooperative bargaining framework where the investment in risky assets depends on the bargaining power of the more risk tolerant spouse. Copyright Springer Science+Business Media New York 2015

Keywords: Portfolio choice; Risky assets; Household bargaining; Risk tolerance; Bargaining power (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (20)

Downloads: (external link)
http://hdl.handle.net/10.1007/s11150-013-9207-8 (text/html)
Access to full text is restricted to subscribers.

Related works:
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:reveho:v:13:y:2015:i:2:p:219-241

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/11150/PS2

DOI: 10.1007/s11150-013-9207-8

Access Statistics for this article

Review of Economics of the Household is currently edited by Shoshana Grossbard

More articles in Review of Economics of the Household from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().