Abstract
This paper empirically analyzes how individual characteristics are associated with risk aversion, loss aversion, time discounting, and present bias. To this end, we conduct a large-scale demographically representative survey across eight European countries. We elicit preferences using incentivized multiple price lists and jointly estimate preference parameters to account for their structural dependencies. Our findings suggest that preferences are linked to a variety of individual characteristics such as age, gender, and income as well as some personal values. We also report evidence on the relationship between cognitive ability and preferences. Incentivization, stake size, and the order of presentation of binary choices matter, underlining the importance of controlling for these factors when eliciting economic preferences.
Original language | English |
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Pages (from-to) | 77-107 |
Number of pages | 31 |
Journal | Journal of Risk and Uncertainty |
Volume | 66 |
Issue number | 1 |
Early online date | 16 Aug 2022 |
DOIs | |
Publication status | Published - Feb 2023 |
JEL classifications
- d01 - Microeconomic Behavior: Underlying Principles
- d03 - Behavioral Economics: Underlying Principles
- c91 - Design of Experiments: Laboratory, Individual
Keywords
- Preference elicitation
- Risk preferences
- Loss aversion
- Time preferences
- Present bias
- LOSS AVERSION
- COGNITIVE-ABILITY
- PROSPECT-THEORY
- ECONOMIC PREFERENCES
- CHOICE BEHAVIOR
- ELICITING RISK
- DISCOUNT RATES
- ATTITUDES
- GENDER
- UNCERTAINTY