Risk-taking on Behalf of Others

Kristoffer W. Eriksen, Ola Kvaløy and Miguel Luzuriaga

No 6378, CESifo Working Paper Series from CESifo

Abstract: We present an experimental study on how people take risk on behalf of others. We use three different elicitation methods, and study how each subject makes decisions both on behalf of own money and on behalf of another individual’s money. We find a weak tendency of lower risk-taking with others’ money compared to own money. However, subjects believe that other participants take more risk with other people’s money than with their own. At the same time, subjects on average think that others are more risk averse than themselves. The data also reveals that subjects are quite inconsistent when making risk decisions on behalf of others, indicating random behavior. A large majority of subjects alternates between taking more risk, less risk or the same amount of risk with other people’s money compared to own money.

Keywords: risk-taking; other people's money; beliefs; preferences; experiment (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-cbe, nep-exp and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Related works:
Journal Article: Risk-taking on behalf of others (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_6378

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