Ferdinand Vieider (Reading & WZB)

This week's seminar will be given by Ferdinand Vieider from the University of Reading and WZB

Title: All Over the Map: Heterogeneity of Risk Preferences across Individuals, Prospects, and Countries

Abstract: "We analyze the risk preferences of 2939 subjects across 30 countries on all continents. Using structural modeling, we explore heterogeneity in risk preferences across three dimensions: i) between individuals; ii) between prospects; and iii) between countries. Preferences in non-Western countries differ systematically from those found in Western countries, hitherto considered universal. Reference-dependence and likelihood-dependence are both found to play a role in describing preferences. While we confirm previous results on individual characteristics explaining little of overall preference heterogeneity, between countries a few macroeconomic indicators can explain a considerable part of the heterogeneity. The heterogeneity explained furthermore differs across decision parameters, being low for pure risk aversion measures, but higher for measures of noise and for rationality parameters."

View a copy of the paper (PDF).