Emotions and Risk Attitudes
Armando Meier ()
No 1118, SOEPpapers on Multidisciplinary Panel Data Research from DIW Berlin, The German Socio-Economic Panel (SOEP)
Previous work has shown that preferences are not always stable across time, but surprisingly little is known about the reasons for this instability. I examine whether variation in people’s emotions over time predicts changes in risk attitudes. Using a large panel data set, I identify happiness, anger, and fear as signiﬁcant correlates of within-person changes in risk attitudes. Robustness checks indicate a limited role of alternative explanations. An event study around the death of a parent or child further conﬁrms a large relationship between emotions and risk attitudes.
Keywords: Emotions; happiness; risk attitudes; risk preferences; preference stability; SOEP (search for similar items in EconPapers)
JEL-codes: D01 D90 D91 (search for similar items in EconPapers)
Pages: 53 p.
New Economics Papers: this item is included in nep-cbe, nep-cwa, nep-hap and nep-rmg
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Persistent link: https://EconPapers.repec.org/RePEc:diw:diwsop:diw_sp1118
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