Risk breeds risk aversion

• Published in: Experimental economics : a journal of the Economic Science Association Vol. 21; no. 4; pp. 815 - 835
• Main Authors: He, Tai-Sen, Hong, Fuhai
• Format: Journal Article
• Language: English
• Published: New York Springer US 01.12.2018; Springer Nature B.V
• Subjects: Behavioral/Experimental Economics; Economic theory; Economic Theory/Quantitative Economics/Mathematical Methods; Economics; Economics and Finance; Game Theory; Lotteries; Microeconomics; Operations Research/Decision Theory; Original Paper; Risk; Risk aversion; Risk behavior; Risk taking; Social and Behav. Sciences; Risk aversion; Risk; C91; Laboratory experiment; D81

We examine whether exposure to a more or less risky environment affects people’s subsequent risk-taking behavior. In a laboratory setting, all subjects went through twelve rounds of multiple-price-list decisions between a risky alternative and a safe alternative. In the first six rounds, subjects we...