School Seminar |Higher order risk preferences and economic decisions by Charles Noussair – School of Economics School Seminar |Higher order risk preferences and economic decisions by Charles Noussair – School of Economics

School Seminar |Higher order risk preferences and economic decisions by Charles Noussair

School of Economics

 Invites you to a

School seminar presented by

Charles Noussair

(Arizona State University)

Higher order risk preferences and economic decisions

 

Co-authors:

(Yi Long Xu – Utrecht University)

(Maarten Boksem – Erasmus University)

(Stefan Trautmann – Heidelberg University)

(Gijs van de Kuilen – Tilburg University)

(Alan Sanfey – Radboud University)

 

Thursday 26 October 2023

11.00pm – 12.30pm

Seminar Room 650
A02 Social Sciences Building

Camperdown Campus
The University of Sydney NSW 2006

 

In theory, individuals’ higher order risk attitudes of prudence and temperance influence saving and investment decisions. Prudent individuals save more when their future income becomes more uncertain, and temperate individuals prefer less risky investments in the presence of greater background risks. In a controlled experiment, we measure individuals’ higher order risk attitudes directly, using two different elicitation methods. Participants then make saving and investment decisions under varying levels of background risk. We find strong evidence for background risk effects on saving and investment. Moreover, individual prudence measures correlate with the strength of precautionary saving, while individual temperance measures do not do so with investment. The risk attitudes acquired with the two elicitation methods are strongly correlated with each other. The representative individual is risk averse and prudent, and neutral towards temperance.

For further information contact: School seminar series coordinators
Alastair Fraser (alastair.fraser@sydney.edu.au) & Brendan Beare (brendan.beare@sydney.edu.au)

For all upcoming seminars in School of Economics see Our events and Calendar

Date

Oct 26 2023
Expired!

Time

11:00 am - 12:30 pm

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