Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/85582
Authors: 
Hartog, Joop
Ferrer-i-Carbonell, Ada
Jonker, Nicole
Year of Publication: 
2000
Series/Report no.: 
Tinbergen Institute Discussion Paper 00-074/3
Abstract: 
We ask individuals for their reservation price of a specified lotteryand deduce their Arrow-Pratt measure of risk aversion.This allows direct testing of common hypotheses on risk attitudes inthree datasets. We find that risk aversion indeed fallswith income and wealth. Entrepreneurs are less risk averse thanemployees, civil servants are more risk averse thanprivate sector employees, and women are more risk averse than men. Weanalyze six different specifications of the lotteryquestion in a single data set and find quite consistent results. Weconclude that a simple lottery question is a promisingsurvey instrument to extract differences in risk attitudes amongindividuals.
JEL: 
D81
C81
Document Type: 
Working Paper

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