Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/216366 
Year of Publication: 
2020
Series/Report no.: 
IZA Discussion Papers No. 13054
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
This paper presents evidence suggesting men's (but not women's) risk and time preferences have systematically become sensitive to local economic conditions since the 2008 financial crisis. Studying longitudinal, nationally representative data for 22,579 Australian-based respondents in up to 11 surveys from 2002-2015, men respond with increased risk aversion and impatience to a rise in their region's unemployment rate – but only since 2008. We find no such relationship for women or before the crisis. This conclusion persists when accounting for individual-level fixed effects, demographics, national economic conditions, the individual's employment situation, income, wealth, as well as region- and time-specific unobservables. Exploring a potential mechanism, higher regional unemployment rates are also linked to men (but not women) being more unhappy since 2008. This 'happiness channel' only partially explains the link between the local unemployment rate and risk preferences.
Subjects: 
risk preferences
time preferences
gender differences
financial crisis
JEL: 
D81
G11
G14
G41
J16
Document Type: 
Working Paper

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