A Simple Risk-Sharing Experiment

John Bone (), John Hey and John Suckling

Discussion Papers from Department of Economics, University of York

Abstract: This paper reports on an experiment designed to test whether pairs of individuals are able to exploit efficiency gains in the sharing of a risky financial prospect. Observations from a previous experiment had suggested a general rejection of efficiency in favour of ex post equality. The present experiment explores some possible explanations for this. The results indicate that fairness is not a significant consideration, but rather that having to choose between prospects diverts partners from allocating the chosen prospect efficiently.

Keywords: Risk-sharing; experiments; bargaining, fairness. (search for similar items in EconPapers)
JEL-codes: C91 C92 D81 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-exp, nep-fin and nep-ias
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Journal Article: A Simple Risk-Sharing Experiment (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:yor:yorken:00/36

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