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1/1
Individual Risk Attitudes
New Evidence from a Large, Representative, Experimentally-Validated Survey
Thomas Dohmen, Armin Falk, David Huffman, Uwe Sunde
(IZA and University of Bonn)
Jürgen Schupp, Gert G. Wagner
(DIW, Berlin, and IZA, Bonn)
Oxford, July 2006
2/1
Motivation Risk and uncertainty are pervasive in
economic life.
As a consequence, individual attitudes towards risk play a central role in economic theory. Predicted to have a decisive impact on almost
every important economic decision.
The aim of this paper is to improve understanding and measurement of individual risk attitudes.
3/1
Research questions Do risk attitudes vary across individuals? What are the determinants of individual
differences? Are hypothetical measures of risk attitudes
reliable predictors of actual risky behavior? What is the impact of context on willingness to
take risks? Is there a single underlying preference that
determines risk-taking in all contexts? How does the impact of personal characteristics
vary with context? Can survey questions incorporating situation-
appropriate context outperform standard lottery measures of risk preference?
4/1
Data Large, representative sample: 22,019
individuals. 2004 Wave of the Socioeconomic Panel
(SOEP) Extensive socio-demographic information.
New survey measures. New survey measures.
Complementary field experiment: 450 individuals. Subjects answer same survey measures as in
SOEP. Also make risky choices for real money.
5/1
Survey Measures General Risk Question
How do you see yourself: Are you generally a person who is fully prepared to take risks or do you try to avoid taking risks? Please tick a box on the scale, where the value 0 means: ‘unwilling to take risks’ and the value 10 means: ‘fully prepared to take risks’.
11-point response scale: completely unwilling to completely willing. Open-ended: Respondent free to think about curvature of
utility,but also imagine stakes and probabilities involved in taking risks.
Context Questions Same scale, but ask about: Car driving, health, financial matters,
sports and leisure, career.
Hypothetical Investment Question Willingness to invest in a realistic investment opportunity, with
explicit stakes and probabilities. Holds beliefs constant, measures risk preference.
6/1
Outline of the talk Distribution of risk attitudes. Determinants. Does the survey measure predict
behavior? Alternative measure of risk preference. Impact of context on risk attitudes. Compare predictive power of different
measures. Evidence on occupational sorting and
regional mobility. Intergenerational transmission of risk
attitudes and assortative mating.
7/1
Heterogeneity and Determinants
General Risk Question
8/1
Distribution of Willingness to Take Risks0
.05
.1.1
5.2
Fra
ction
0 2 4 6 8 100=completely unwilling; 10=completely willing
All Respondents - SOEP 2004
9/1
Gender and Willingness to Take Risks-.
06
-.04
-.02
0.0
2.0
4D
iffe
rence in F
raction
0 2 4 6 8 100=completely unwilling; 10=completely willing
Gender Differences
10/1
Age and Willingness to Take Risks
0.2
.4.6
.81
Fra
ctio
n U
nwill
ing
0.2
.4.6
.81
Fra
ctio
n W
illin
g
20 30 40 50 60 70 80 90Age in Years
High Willingness to Take Risks 10 9 8 7 6Low Willingness to Take Risks 4 3 2 1 0
Men
11/1
Age and Willingness to Take Risks
0.2
.4.6
.81
Fra
ctio
n U
nwill
ing
0.2
.4.6
.81
Fra
ctio
n W
illin
g
20 30 40 50 60 70 80 90Age in Years
High Willingness to Take Risks 10 9 8 7 6Low Willingness to Take Risks 4 3 2 1 0
Women
12/1
Parental Ed. and Willingness to Take Risks
0.0
5.1
.15
.2F
ract
ion
0 2 4 6 8 10Response to General Risk Question
(0=completely unwilling; 10=completely willing)
Father's education: Abitur not completed
0.0
5.1
.15
.2F
ract
ion
0 2 4 6 8 10Response to General Risk Question
(0=completely unwilling; 10=completely willing)
Mother's education: Abitur not completed
0.0
5.1
.15
.2F
ract
ion
0 2 4 6 8 10Response to General Risk Question
(0=completely unwilling; 10=completely willing)
Father's education: Abitur completed
0.0
5.1
.15
.2F
ract
ion
0 2 4 6 8 10Response to General Risk Question
(0=completely unwilling; 10=completely willing)
Mother's education: Abitur completed
13/1
Height and Willingness to Take Risks
0.2
.4.6
.81
Fra
ctio
n U
nwill
ing
0.2
.4.6
.81
Fra
ctio
n W
illin
g
150 155 160 165 170 175 180 185 190 195Height in cm
High Willingness to Take Risks 10 9 8 7 6Low Willingness to Take Risks 4 3 2 1 0
Men
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Height and Willingness to Take Risks
0.2
.4.6
.81
Fra
ctio
n U
nwill
ing
0.2
.4.6
.81
Fra
ctio
n W
illin
g
150 155 160 165 170 175 180 185 190 195Height in cm
High Willingness to Take Risks 10 9 8 7 6Low Willingness to Take Risks 4 3 2 1 0
Women
15/1
Determinants of Risk Attitudes (Probit)
Dependent Variable: General Risk Attitude (1=Willing to Take Risks) (Marginal Effects) (1) Female -0.111*** (0.009)Age -0.005*** (0.000)Height (in cm) 0.005*** (0.001)Abitur Mother 0.062*** (0.016)Abitur Father 0.036***
(0.012)
Individual Wealth and Income NoHousehold Wealth and Income NoAdditional Controls NoObservations 19438
16/1
Determinants of Risk Attitudes (Probit)
Dependent Variable: General Risk Attitude (1=Willing to Take Risks) (Marginal Effects) (1) (2)Female -0.111*** -0.093*** (0.009) (0.011)Age -0.005*** -0.003*** (0.000) (0.000)Height (in cm) 0.005*** 0.003*** (0.001) (0.001)Abitur Mother 0.062*** 0.038*** (0.016) (0.018)Abitur Father 0.036*** -0.011
(0.012) (0.013)
Individual Wealth and Income No YesHousehold Wealth and Income No NoAdditional Controls No YesObservations 19438 16284
17/1
Determinants of Risk Attitudes (Probit)
Dependent Variable: General Risk Attitude (1=Willing to Take Risks) (Marginal Effects) (1) (2) (3)Female -0.111*** -0.093*** -0.104*** (0.009) (0.011) (0.011)Age -0.005*** -0.003*** -0.003*** (0.000) (0.000) (0.000)Height (in cm) 0.005*** 0.003*** 0.003*** (0.001) (0.001) (0.001)Abitur Mother 0.062*** 0.038*** 0.027 (0.016) (0.018) (0.017)Abitur Father 0.036*** -0.011 -0.005
(0.012) (0.013) (0.013)
Individual Wealth and Income No Yes NoHousehold Wealth and Income No No YesAdditional Controls No Yes YesObservations 19438 16284 17435
18/1
Can Survey QuestionsPredict Behavior?
19/1
Experimental Design 450 subjects. Representative sample of adult population in Germany. Subjects answer the general risk question. Subjects also make 20 choices for real money Each choice is between a lottery and a safe option:
Lottery: 300 Euros or 0 Euros, with equal probability. Safe option: X Euros for sure, where X varies across choices. X=0 in first choice, increases to 190 in 20th choice (by 10’S)
One choice is randomly selected and implemented. Measure of risk taking: how high does X have to be, to
induce a switch from the lottery to the safe option?
20/1
Lottery Choices and Survey Answers
6080
100
120
Ave
rage
Saf
e V
alue
at S
witc
h P
oint
0 1 2 3 4 5 6 7 8 9 10Response to General Risk Question
Fitted Line
(0=completely unwilling; 10=completely willing)
21/1
Validation of Survey Risk Measure
(1) (2) (3)Willingness to Take Risk in General 5.614*** 4.447*** 4.010***
[1.082] [1.109] [1.446]
Controls for Gender, Age, Height No Yes YesOther Controls No No Yes
Constant 57.097*** -68.309 -33.005[5.836] [70.621] [127.048]
R-squared 0.06 0.09 0.25Obs 450 450 313
Dependent Variable: Value of Safe Option at Switch Point
22/1
Alternative Measureof Risk Attitudes
23/1
Survey measure Hypothetical Investment Scenario
Choose how much of 100,000 Euros to invest in a hypothetical asset.
doubles the investment, or returns half, with equal probability.
Possible amounts: 0, 20K, 40K, 60K, 80K, 100K
Holds beliefs constant across individuals. Differences can be attributed to differences in
curvatures of utility. Incorporates context of real financial decision.
24/1
Investment in Hypothetical Asset
0.2
.4.6
Fra
ctio
n
0 20 40 60 80 100Amount invested in thousands of Euros
25/1
Determinants of Investment (Probit)
Dependent Variable: Amount Invested (0 to 100,000)(1)
Female -5,997.97*** [811.62]Age -352.65*** [20.51]Height (in cm) 204.98*** [48.85]Abitur Mother 1,420.56 [1,291.08]Abitur Father 6,521.58***
[986.43]
Individual Wealth and Income NoHousehold Wealth and Income NoOther Controls NoObs. 19,419
26/1
Determinants of Investment (Probit)
Dependent Variable: Amount Invested (0 to 100,000)(1) (2)
Female -5,997.97*** -6,597.82*** [811.62] (978.35)Age -352.65*** -233.77*** [20.51] (46.46)Height (in cm) 204.98*** 102.51* [48.85] (59.93)Abitur Mother 1,420.56 -144.79 [1,291.08] (1508.10)Abitur Father 6,521.58*** 2,429.78**
[986.43] (1128.95)
Individual Wealth and Income No YesHousehold Wealth and Income No NoOther Controls No YesObs. 19,419 16,264
27/1
Determinants of Investment (Probit)
Dependent Variable: Amount Invested (0 to 100,000)(1) (2) (3)
Female -5,997.97*** -6,597.82*** -6,793.28*** [811.62] (978.35) (936.11)Age -352.65*** -233.77*** -200.19*** [20.51] (46.46) (44.42)Height (in cm) 204.98*** 102.51* 105.15* [48.85] (59.93) (57.73)Abitur Mother 1,420.56 -144.79 89.58 [1,291.08] (1508.10) (1434.26)Abitur Father 6,521.58*** 2,429.78** 2,595.48**
[986.43] (1128.95) (1085.43)
Individual Wealth and Income No Yes NoHousehold Wealth and Income No No YesOther Controls No Yes YesObs. 19,419 16,264 17,417
28/1
CRRA Coefficients (interior responses)
0.1
.2.3
.4D
ensi
ty
0 5 10 15 20 25 30 35 40gamma
CRRA Interval Midpoints
29/1
General Risk Attitude and CRRA Coeff.
010
,000
20,0
0030
,000
Am
ount
Inve
sted
0 1 2 3 4 5 6 7 8 9 10Response to General Risk Question
(0=completely unwilling; 10=completely willing)
Average Investment Average Investment of MenAverage Investment of Women
30/1
Context and Risk Attitudes
31/1
Correlation of Risk Attitudes Across Domains
General Car Financial Sports/ Career Health Driving Matters Leisure
Mean 4.420 2.927 2.406 3.486 3.605 2.934
Mean (Men) 4.909 3.523 2.882 3.961 4.039 3.317 Mean (Women) 3.967 2.346 1.963 3.044 3.190 2.580
General 1.000 Car Driving 0.490 1.000 Financial Matters 0.506 0.520 1.000 Sports/Leisure 0.563 0.542 0.503 1.000 Career 0.609 0.507 0.498 0.605 1.000 Health 0.474 0.503 0.458 0.522 0.531 1.000
32/1
Determinants in Different Contexts
Do the exogenous factors have the same impact across domains?
33/1
Determinants in Different Contexts
Do the exogenous factors have the same impact across domains?
Gender, Age, Parental Education, and Height Affect risk attitudes in most domains. Effects are qualitatively similar to
general risk. But magnitudes differ across
domains, e.g. gender matters more in driving than in financial matters.
34/1
Primary Determinants of Risk AttitudesDependent Variable: Willingness to Take Risks (Binary Measure) in:
General Car Driving Financial Sports/ Career Health Matters Leisure (1) (2) (3) (4) (5) (6)
Female -0.111*** -0.091*** -0.078*** -0.095*** -0.082*** -0.062*** (0.009) (0.008) (0.006) (0.008) (0.009) (0.007)Age -0.005*** -0.004*** -0.001*** -0.007*** -0.005*** -0.003*** (0.000) (0.000) (0.000) (0.000) (0.000) (0.000)Height 0.005*** 0.002*** 0.001*** 0.003*** 0.003*** 0.001***
(0.001) (0.000) (0.000) (0.000) (0.001) (0.000)Abitur Mother 0.063*** 0.02 0.029*** 0.041*** 0.047*** 0.014 (0.016) (0.012) (0.010) (0.013) (0.015) (0.011)Abitur Father 0.035*** -0.004 0.015** 0.065*** 0.034*** 0.017** (0.012) (0.009) (0.007) (0.011) (0.011) (0.009) Pseudo-R² 0.064 0.074 0.062 0.114 0.058 0.042log Pseudo-Likelihood -11471 -7935 -5816 -9185 -9475 -7988Obs. 19438 18313 19274 19186 17683 19431
35/1
Comparing Predictive Power
of Alternative Measures
Within and Across Contexts
36/1
Predicting Behavior in Different Contexts
Regress behavioral outcomes sequentially on each risk measure separately. General risk, 5 domain-specific, and
hypothetical investment choice.
Behavioral outcomes span the five contexts identified in the SOEP Real-world portfolio choice, participation in
sports , occupational choice, smoking, migration, life satisfaction, traffic violations.
Compare predictive power of different measures, within and across contexts.
37/1
Determinants of Behavior in Different Domains
Dependent variable: Investment in Active Sports Employment SelfemployedStocks in Public Sector
(1) (2) (3) (4)Willingness to take risks(binary measure) in ...... General 0.035*** 0.083*** -0.014** 0.006*** [0.011] [0.009] [0.007] [0.002]
(-4708.9) (-8726.2) (-6361.1) (-1446.4)Positive amount invested 0.085*** 0.086*** 0.016** -0.001in hypothetical asset [0.011] [0.008] [0.007] [0.002] (-4683.1) (-8716.1) (-6360.2) (-1450.7)Willingness to Take Risks(binary measure) in ...... Car driving 0.10 0.038*** -0.009 0.001
[0.014] [0.011] [0.008] [0.003](-4713.4) (-8768.8) (-6362.7) (-1450.7)
... Financial matters 0.244*** 0.079*** 0.003 0.007**[0.018] [0.013] [0.011] [0.003]
(-4618.2) (-8756.9) (-6363.3) (-1448.2)... Sports and leisure 0.060*** 0.184*** 0.01 0.003
[0.013] [0.009] [0.008] [0.003](-4703.0) (-8579.2) (-6362.6) (-1450.0)
...Career 0.053*** 0.084*** -0.012* 0.018***[0.013] [0.009] [0.007] [0.003]
(-4704.2) (-8731.7) (-6361.9) (-1421.3)...Health 0.014 0.033*** 0.012 0.002
[0.014] [0.011] [0.009] [0.003](-4713.2) (-8770.5) (-6362.4) (-1450.6)
Observations 8,610 16,066 13,925 13,925
38/1
Determinants of Behavior in Different Domains
Dependent variable: Smoking Mobility from Mobility from Overall LifeEast to West West to East Satisfaction
(5) (6) (7) (8)Willingness to take risks(binary measure) in ...... General 0.052*** 0.018* 0.006*** 0.345*** [0.008] [0.011] [0.003] [0.029]
(-9333.2) (-848.7) (-437.8) (0.09)Positive amount invested -0.003 0.001 -0.001 0.142***in hypothetical asset [0.008] [0.010] [0.002] [0.029] (-9354.2) (-850.2) (-441.9) (0.08)Willingness to Take Risks(binary measure) in ...... Car driving 0.036*** -0.014 -0.002 0.123***
[0.010] [0.012] [0.002] [0.042](-9347.3) (-849.6) (441.4) (0.08)
... Financial matters -0.018 -0.002 -0.001 0.247***[0.012] [0.018] [0.003] [0.043]
(-9353.1) (-850.2) (-441.9) (0.08)... Sports and leisure 0.001 0.005 0.004* 0.251***
[0.009] [0.013] [0.003] [0.033](-9354.3) (-850.1) (-440.6) (0.09)
...Career 0.034*** -0.018 0.002 0.171***[0.009] [0.011] [0.002] [0.032]
(-9346.2) (-848.8) (-441.7) (0.08)...Health 0.128*** -0.014 -0.003 0.045
[0.011] [0.013] [0.002] [0.038](-9276.4) (-849.7) (-441.2) (0.08)
Observations 16,120 2,971 8,211 16,117
39/1
Traffic Offenses and Willingness to Take Risks
0.0
2.0
6.1
.14
.18
Offe
nse
Rat
es
0.1
.2.3
.4.5
Fra
ctio
n W
illin
g
20 30 40 50 60 70 80 90Age in Years
Willingness to Take Risks 10 9 8 7 6 Unweighted Offense Rate Weighted Offense Rate use lic.
Men
40/1
Traffic Offenses and Willingness to Take Risks
0.0
2.0
4.0
6.0
8.1
Offe
nse
Rat
es
0.1
.2.3
.4.5
Fra
ctio
n W
illin
g
20 30 40 50 60 70 80 90Age in Years
Willingness to Take Risks 10 9 8 7 6 Unweighted Offense Rate Weighted Offense Rate use lic.
Women
41/1
Comparing Predictive Power Most measures predict behavior across several
contexts. Suggestive of a single risk trait. Provides additional evidence that the measures are
behaviorally relevant.
However, best predictor of behavior in a given context is always corresponding domain-specific question. Measure of risk attitudes should incorporate situation-
specific context, in order to predict specific behavior. E.g. ask about willingness to take risks in health matters,
in order to predict risky health behaviors, rather than using a measure of willingness to take risks in financial matters.
42/1
Conclusions
43/1
Conclusions Self-reported willingness to take risks
varies across individuals.
Exogenous factors explain individual differences: Women and older individuals are more
cautious. Children of highly-educated parents and taller
individuals take more risks.
Survey measures are behaviorally relevant: predict actual risk-taking behavior in a field experiment.
44/1
Conclusions
Heterogeneity at least partly driven by differences in risk preferences, rather than subjective beliefs.
Exogenous factors affect risk preferences in a similar way across domains, but magnitude varies.
CRRA coefficients consistent with range typically assumed in economic models.
45/1
Conclusions
Risk attitudes are strongly but imperfectly correlated across contexts.
All survey measures predict across several contexts.
But best predictor of behavior in a specific context is a question framed in terms of that context.
46/1
Additional Material
47/1
Occupational Earnings Risk
0.10
0.15
0.20
0.25
0.30
0.35
0.40
0.45
0.50
5.80 6.00 6.20 6.40 6.60 6.80 7.00
Conditional log Occupation Wage
Occ
up
atio
n E
arn
ing
s R
isk
48/1
Risk Attitudes and Occupational Sorting
0.10
0.15
0.20
0.25
0.30
0.35
0.40
0.45
0.50
4.00 4.50 5.00 5.50 6.00 6.50 7.00
Mean of Individual Risk Preferences in 2-digit Occupation
Occ
up
atio
n E
arn
ing
s R
isk
49/1
Risk Attitudes and Regional Mobility in Germany
0
0.05
0.1
0.15
0.2
0.25
1 2 3 4 5 6 7 8 9 10 11
Willingness to take risks
Sh
are
Stayers
Movers
50/1
Static Regressions, Ever Moved in 2000-2004
Marg. Marg. Marg. Marg.Effect S.E. Effect S.E. Effect S.E. Effect S.E.
Risk Index .0054 (.0008) .0022 (.0007)
"Risk Lover" 0.0259 (.0045) .0121 (.0035)
Age (2000) -.0018 (.0002) -.0018 (.0002)
Female .0053 (.0031) .0052 (.0031)
Married (2000) -.0361 (.0045) -.0363 (.0045)
Years of Education (2000) .0049 (.0006) .0049 (.0006)
Origin/NationalityWest GermanEast German .0055 (.0036) .0056 (.0036)Born Abroad .0053 (.0055) .0047 (.0055)
Pseudo-R2 .0088 .1075 .1081.0088
ref. ref.
(4)(1) (2) (3)
51/1
Intergenerational Transmission
of Risk Attitudes
52/1
44
.55
5.5
66
.5C
hild
's a
vera
ge
ge
ne
ral r
isk
atti
tud
e
0 1 2 3 4 5 6 7 8 9 10Mother's risk attitude
Child's risk attitude (average)
Weighted regression line
44
.55
5.5
66
.5C
hild
's a
vera
ge
ge
ne
ral r
isk
atti
tud
e
0 1 2 3 4 5 6 7 8 9 10Father's risk attitude
Child's risk attitude (average)
Weighted regression line0
.05
.1.1
5.2
Fra
ctio
n
0 2 4 6 8 10Mother's willingness to take risks in general
(0=completely unwilling; 10=completely willing)
Mothers's risk attitudes
0.0
5.1
.15
.2F
ract
ion
0 2 4 6 8 10Father's willingness to take risks in general
(0=completely unwilling; 10=completely willing)
Father's risk attitudes
Significant determinants of risk attitudes: Gender, Age, Height
53/1
Dependent Variable(1) (2) (3)
Mother's willingness to take risks in general 0.029*** 0.028*** 0.029***[0.004] [0.004] [0.005]
Father's willingness to take risks in general 0.024*** 0.022*** 0.024***[0.004] [0.004] [0.004]
1 if female -0.104*** -0.101***[0.026] [0.027]
Age of respondent (years) -0.009*** -0.009***[0.002] [0.003]
Height of respondent (cm) 0.006*** 0.006***[0.002] [0.002]
Age of mother (years) 0.002 0.003[0.003] [0.003]
Age of father (years) 0.001 0.001[0.002] [0.002]
Height of mother (cm) -0.001 -0.001[0.002] [0.002]
Height of father (cm) -0.001 -0.001[0.002] [0.002]
Additional controls no no yesPseudo-R-squared 0.03 0.057 0.066
Observations 3331 3320 3320
Willingness to Take Risk in General
54/1
Specificity of transmission process
Do parents pass on a relatively general, unspecific disposition towards risk?
Or do they pass on a bundle of distinct risk attitudes?
Each domain regressed simultaneously on all domains If transmission is distinct: ‘diagonal’
should be most important
55/1
Dependent Variable: Willingness to take risks in the domain of(1) (2) (3) (4) (5) (6)
General Car driving Financial matters Sports & leisure Career HealthGeneral: Mother 0.026*** 0.002 -0.002 0.006 0.006 -0.010**
[0.007] [0.005] [0.003] [0.007] [0.006] [0.005]General: Father 0.020*** -0.004 -0.004 -0.009 0.003 0.002
[0.007] [0.006] [0.003] [0.007] [0.007] [0.005]Car driving: Mother -0.011 0.025*** 0.001 -0.006 -0.002 0
[0.007] [0.005] [0.003] [0.007] [0.006] [0.005]Car driving: Father 0.003 0.019*** 0 0.001 -0.001 -0.006
[0.006] [0.005] [0.003] [0.006] [0.006] [0.004]Financial matters: Mother 0.006 -0.014** 0.009*** -0.016* 0.007 0.005
[0.008] [0.007] [0.003] [0.008] [0.007] [0.005]Financial matters: Father 0.01 -0.001 0.007** 0.01 -0.013** -0.005
[0.007] [0.005] [0.003] [0.007] [0.006] [0.005]Sports & leisure: Mother -0.007 0.004 -0.003 0.041*** -0.01 -0.006
[0.008] [0.006] [0.003] [0.008] [0.007] [0.005]Sports & leisure: Father -0.015** -0.001 0 0.032*** 0.003 -0.003
[0.007] [0.005] [0.003] [0.007] [0.006] [0.004]Career: Mother 0.005 -0.011** 0.002 0.003 0.013** 0.006
[0.007] [0.006] [0.003] [0.007] [0.007] [0.005]Career: Father 0.001 0.002 0.004 -0.005 0.019*** -0.007
[0.006] [0.005] [0.003] [0.007] [0.006] [0.005]Health: Mother 0.005 0.001 0 -0.001 0.003 0.013***
[0.007] [0.005] [0.003] [0.007] [0.006] [0.005]
Health: Father -0.014** -0.005 0 -0.014** 0 0.018***
[0.006] [0.005] [0.003] [0.006] [0.006] [0.004]
Additional controls yes yes yes yes yes yesPseudo R-squared 0.283 0.216 0.216 0.301 0.266 0.22Observations 2585 2585 2585 2585 2585 2585
56/1
Positive Assortative Mating
in Risk Attitudes
57/1
Assortative mating Assortative mating reinforces strength
and importance of intergenerational transmission
Similarity of partners’ preferences? Less conflict in bargaining, better
coordination, agency perspective Partners tend to be similar
Age, social background, physical attractiveness or height but also behaviors (e.g., smoking, leisure activities)
Similarity in outcomes and behavior affected by preference sorting in the marriage market
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Assortative mating: risk attitudes
(1) (2) (3)Female partner's willingness 0.352*** 0.311*** 0.291***to take risks in general [0.011] [0.011] [0.012]Age of male spouse in years -0.017*** -0.019***
[0.006] [0.006]Height of male spouse in cm 0.026*** 0.021***
[0.004] [0.004]Age of female spouse in years -0.008 -0.008
[0.006] [0.006]Height of female spouse in cm -0.004 -0.007
[0.004] [0.004]Controls for parental background of spouses No Yes YesControls for education degree of spouses No No YesControls for childhood socialization No No YesControls for religion No No YesConstant 3.418*** 0.75 1.495 [0.051] [0.864] [0.958]
Observations 7272 7189 6996R-squared 0.12 0.16 0.17
Dependent Variable: Willingness to take risks in general (male partner)
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Robustness checks on restricted samples
OLS Coefficient Estimates of Spouse's Willingness to Take Risks(only cohabiting married couples)
Sample restriction No controlsExogenous factors
Social back-ground
0.365*** 0.330*** 0.309***[0.012] [0.012] [0.013]N=6373 N=6312 N=61580.364*** 0.330*** 0.308***[0.013] [0.013] [0.013]N=5881 N=5838 N=57170.349*** 0.319*** 0.306***[0.015] [0.015] [0.015]N=4259 N=4227 N=41620.304*** 0.266*** 0.268***[0.031] [0.031] [0.032]N=994 N=987 N=9700.260*** 0.233*** 0.228***[0.041] [0.042] [0.043]N=559 N=551 N=532
with non-contradictory information on marriage date
all cohabiting married
with children
with one child
without children
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Subjects‘ Responses to General Risk Question0
.05
.1.1
5.2
Fra
ctio
n
0 1 2 3 4 5 6 7 8 9 10Response to General Risk Question
(0=completely unwilling; 10=completely willing)
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Distribution of Lottery Choices
0.0
5.1
.15
Fra
ctio
n
0 50 100 150 200Safe Value at Switch Point
Choices of Subjects in Experiment