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Shaking Things Up: On the Stability of Risk and Time preferences

Michel Beine (), Gary Charness (), Anaud Dupuy () and Majlinda Joxhe ()
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Anaud Dupuy: Department of Economics and Management, Université du Luxembourg

DEM Discussion Paper Series from Department of Economics at the University of Luxembourg

Abstract: We conduct a survey and incentivized lab-in-the-field experimental tasks in Tirana, Albania. While the original purpose of our study was to examine whether and how deep parameters such as time and risk preferences affect the intention to migrate, our study was transformed into a natural experiment owing to two large earthquakes that shook the Tirana area during our data-collection period. These events provide us with a rare opportunity to gather evidence (including a pre-earthquake control) on the effect of natural disasters on time and risk preferences. We find unambiguous effects towards more risk aversion and impatience for affected individuals. Moreover, as it turns out, the second earthquake amplified the effect of the first one, suggesting that experiences cumulate in their influence on these preferences.

Keywords: Time preferences; risk preferences; natural disaster; Albania; migration (search for similar items in EconPapers)
JEL-codes: B49 C90 D91 F22 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-cbe, nep-exp and nep-upt
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https://wwwfr.uni.lu/content/download/127408/14701 ... e%20preferences..pdf (application/pdf)

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Working Paper: Shaking Things Up: On the Stability of Risk and Time Preferences (2020) Downloads
Working Paper: Shaking Things Up: On the Stability of Risk and Time Preferences (2020) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:luc:wpaper:20-09

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