Stability of Risk Preference Measures: Results from a Field Experiment on French Farmers

Stéphane Couture and Arnaud Reynaud

No 10-151, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: We compare three different elicitation methods for measuring risk attitudes of French farmers in a field experiment setting. We consider two experiments based on the lottery choices initially proposed by Holt and Laury (2002) and by Eckel and Grossman (2002,2008), a risk-taking psychological questionnaire and a self-reporting of perceived risk attitudes for different domains. The main empirical results from this within-subject study are the following. First, within the class of lottery choices, risk preference measures are affected by the type of mechanism used. In particular, farmers appear to be more risk averse using the Eckel and Grossman lottery than using the Holt and Laury one. However attitudes towards risk are significantly correlated across lotteries which means that the ranking of risk preferences seems to be preserved. Second, risk preferences appear to be context-dependent. French farmers are highly risk averse for decisions belonging to financial and ethical domains. They report a higher willingness to take risk for professional decisions. Lastly, using the psychological questionnaire, we find that the risk attitude elicited through lottery choices often correlates with risk attitude toward investments. These findings contribute to the literature which addresses the stability of risk preferences across elicitation methods.

Keywords: Risk preferences; psychological economics; field experiment; experimental economics (search for similar items in EconPapers)
JEL-codes: C91 D8 J16 Q12 (search for similar items in EconPapers)
Date: 2010-05
New Economics Papers: this item is included in nep-agr, nep-exp and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

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Related works:
Journal Article: Stability of risk preference measures: results from a field experiment on French farmers (2012)
Working Paper: Stability of Risk Preference Measures: Results From a Field Experiment on French Farmers (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:22629

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