Economics at your fingertips  

Multiple-item risk measures

Lukas Menkhoff and Sahra Sakha ()

No 1980, Kiel Working Papers from Kiel Institute for the World Economy (IfW)

Abstract: We compare seven established risk elicitation methods and investigate how they explain an extensive set of risky behavior from a large household survey. We find overall positive correlation between items and low explanatory power in terms of behavior. Using an average of seven risk elicitation methods reduces measurement noise and yields more predictive power. A reduced set of risk items yields the same external validity as the average of all seven methods. Hence, our multiple-item risk measures offer a more reliable way to measure risk preferences. Our results caution against the reliability of one risk method alone due to noise.

Keywords: risk attitude; lab-in-the-field experiments; household survey; economic development (search for similar items in EconPapers)
JEL-codes: C93 D81 O12 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8) Track citations by RSS feed

Downloads: (external link) (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:

Access Statistics for this paper

More papers in Kiel Working Papers from Kiel Institute for the World Economy (IfW) Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().

Page updated 2021-07-18
Handle: RePEc:zbw:ifwkwp:1980