Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/287442 
Year of Publication: 
2021
Citation: 
[Journal:] Journal of Risk and Uncertainty [ISSN:] 1573-0476 [Volume:] 61 [Issue:] 3 [Publisher:] Springer US [Place:] New York, NY [Year:] 2021 [Pages:] 263-287
Publisher: 
Springer US, New York, NY
Abstract: 
This study experimentally evaluates the risk preferences of children and adolescents living in an urban Chinese environment. We use a simple binary choice task that tests risk aversion, as well as prudence. This is the first test for prudence in children and adolescents. Our results reveal that subjects from grades 5 to 11 (10 to 17 years) make mostly risk-averse and prudent choices. The choices of 3rd graders (8 to 9 years) do not differ statistically from risk neutral benchmarks, but at the same time they make mostly prudent choices. We also find evidence for a transmission of risk preferences. There is positive correlation between all children's and their parents' tendency to make risk-averse choices. There is also positive correlation between girls' and their parents' tendency to make prudent choices.
Subjects: 
Risk aversion
Prudence
Transmission of preferences
Age effects
Experimental economics
Children
JEL: 
C93
D81
J13
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Document Version: 
Published Version

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