Risk-Taking and Skewness-Seeking Behavior in a Demographically Diverse Population*

Douadia Bougherara (), Lana Friesen () and Céline Nauges ()
Additional contact information
Douadia Bougherara: CEE-M - Centre d'Economie de l'Environnement - Montpellier - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Institut Agro - Montpellier SupAgro - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement
Lana Friesen: UQ [All campuses : Brisbane, Dutton Park Gatton, Herston, St Lucia and other locations] - The University of Queensland
Céline Nauges: TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement

Working Papers from HAL

Abstract: We study the interaction between risk-taking and skewness-seeking behavior among a demographically diverse sample of French adults using an experiment that elicits certainty equivalent over lotteries that vary the second and third moments orthogonally. We find that the most common behavior is risk avoidance and skewness seeking. On average, we find no interaction between the two, and a weakly significant interaction only in some segments of the population. That is, in most cases, skewness seeking is not affected by the variance of the lotteries involved, nor is risk taking affected by the skewness of the lotteries. We also find a significant positive correlation between risk-avoiding and skewness-seeking behavior. Older and female participants make more risk-avoiding and more skewness-seeking choices, while less educated people and those not in executive occupations are more skewness seeking.Estimated decision models show that utility curvature, likelihood sensitivity, and optimism can explain the observed behaviors.

Keywords: Risk; Skewness; Certainty Equivalent; Experiment (search for similar items in EconPapers)
Date: 2025-02-28
Note: View the original document on HAL open archive server: https://hal.inrae.fr/hal-04972016v1
References: Add references at CitEc
Citations:

Downloads: (external link)
https://hal.inrae.fr/hal-04972016v1/document (application/pdf)

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:hal:wpaper:hal-04972016

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().