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Portfolio allocation, income uncertainty and households' flight from risk
Brown, Sarah; Gray, Daniel; Harris, Mark N.; Spencer, … - 2016
Analysing the US Panel Study of Income Dynamics, we present a new empirical method to investigate the extent to which households reduce their financial risk exposure when confronted with background risk. Our novel modelling approach - termed a deflated fractional ordered probit model -...
Persistent link: https://www.econbiz.de/10011594575
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Hidden insurance in a moral hazard economy
Bertola, Giuseppe; Koeniger, Winfried - 2013
with effort-determined probability. We show that if insurance against a negative shock is sufficiently incomplete, then … standard functional form restrictions ensure that individual objective functions are optimized by an effort and insurance … combination that is unique and satisfies first- and second-order conditions. Modeling insurance incompleteness in terms of costly …
Persistent link: https://www.econbiz.de/10010225898
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Asset integration, risk taking and loss aversion in the laboratory
Morrison, William G.; Oxoby, Robert J. - 2019
We report on a laboratory experiment testing for the presence of loss aversion, as separate from risk aversion, utilizing an asset integration protocol designed to ensure that a loss of cash provided by the experimenter is viewed as a real loss by experimental participants. Our experimental...
Persistent link: https://www.econbiz.de/10011997618
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Stated and revealed heterogeneous risk preferences in educational choice
Fossen, Frank M.; Glocker, Daniela - 2014
Stated survey measures of risk preferences are increasingly being used in the literature, and they have been compared to revealed risk aversion primarily by means of experiments such as lottery choice tasks. In this paper, we investigate educational choice, which involves the comparison of risky...
Persistent link: https://www.econbiz.de/10010245919
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Gender wage gaps and risky vs. secure employment : an experimental analysis
Jung, Seeun; Choe, Chung; Oaxaca, Ronald L. - 2016
In addition to discrimination, market power, and human capital, gender differences in risk preferences might also contribute to observed gender wage gaps. We conduct laboratory experiments in which subjects choose between a risky (in terms of exposure to unemployment) and a secure job after...
Persistent link: https://www.econbiz.de/10011521155
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Compensating differentials in experimental labor markets
Carpenter, Jeffrey P.; Matthews, Peter Hans; Robbett, Andrea - 2015
The theory of compensating differentials has proven difficult to test with observational data: the consequences of …. Instead, we construct experimental, real-effort labor markets and offer an evaluation of the theory in a controlled setting … differentials are affected by worker mobility and therefore selection. Consistent with the theory, we find that riskier firms must …
Persistent link: https://www.econbiz.de/10010477537
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Earnings dispersion, risk aversion and eduation
Belzil, Christian; Hansen, Jörgen - 2002
We estimate a dynamic programming model of schooling decisions in which the degree of risk aversion can be inferred from schooling decisions. In our model, individuals are heterogeneous with respect to school and market abilities but homogeneous with respect to the degree of risk aversion. We...
Persistent link: https://www.econbiz.de/10011411833
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Unemployment benefits, risk aversion, and migration incentives
Heitmueller, Axel - 2002
an insurance device for risk averse migrants; the results for the two groups might differ. Thus, the migration decision …
Persistent link: https://www.econbiz.de/10011414113
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Risk attitudes and household migration decisions
Dustmann, Christian; Fasani, Francesco; Meng, Xin; … - 2017
This paper analyses the relation between individual migrations and the risk attitudes of other household members when migration is a household decision. We develop a simple model that implies that which member migrates depends on the distribution of risk attitudes among all household members,...
Persistent link: https://www.econbiz.de/10011625338
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The "sales agent" problem : effort choice under performance pay as behavior toward risk
Cadsby, Charles Bram; Song, Fei; Zubanov, Nick - 2017
An investor's choice between safe and risky assets has long been seen as a behavior toward risk: more risk-averse investors buy more of the safe asset. Applying this intuition to incentive pay contracts, we develop a model and an experiment that show, in a very general setting, that the choice...
Persistent link: https://www.econbiz.de/10011612830