Taking risk with other people’s money: Does information about the others matter?

Creators: Luzuriaga, Miguel
Title: Taking risk with other people’s money: Does information about the others matter?
Item Type: Article
Projects: ILR
Journal or Publication Title: Review of Behavioral Economics, forthcoming
Date: 2017
Divisions: Wirtschaftswissenschaften
Abstract: This paper experimentally investigates how people take risk with other people’s money, and specifically, whether risk-taking is biased due to the information about others. Before taking risk on behalf of another person, subjects get information about the other person’s gender and self-reported level of extroversion. Information about gender has a surprisingly small effect, and matters more for risk-taking on behalf of own money than for risk-taking on behalf of others. Extroversion, however, has a significant effect. Here it matters more for risk-taking on behalf of others than on behalf of own. I also find that the general belief about how others take risk with other people’s money and the own risk preferences have a strong effect on risk taking on behalf of others.
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Luzuriaga, Miguel (2017) Taking risk with other people’s money: Does information about the others matter? Review of Behavioral Economics, forthcoming.

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