The Relation of Risk Attitudes and Other-Regarding Preferences: A Within-Subjects Analysis

12 Pages Posted: 2 Jun 2015 Last revised: 4 Apr 2016

See all articles by Stephan Müller

Stephan Müller

University of Goettingen (Göttingen)

Holger Andreas Rau

University of Goettingen (Göttingen)

Date Written: February 4, 2016

Abstract

In this paper we provide experimental evidence on the relation of individual risk attitudes and subjects' aversion to favorable inequality. In a within-subjects design we expand Blanco et al.'s (2011) modified dictator game by the risk-elicitation task of Eckel and Grossman (2002). Our data show strong support for a significant negative correlation between risk tolerance and an aversion to favorable inequality. The results are independent of gender, i.e., women and men show a similar correlation in these traits. We present a simple evolutionary model, analyzing the coevolution of risk attitudes and inequality aversion. The model predicts the observed negative relation between the two traits.

Keywords: Experiment,Other-Regarding Preferences, Risk Preferences

JEL Classification: C91, D64, D81

Suggested Citation

Müller, Stephan and Rau, Holger Andreas, The Relation of Risk Attitudes and Other-Regarding Preferences: A Within-Subjects Analysis (February 4, 2016). European Economic Review, Vol. 85, 2016, Available at SSRN: https://ssrn.com/abstract=2613361 or http://dx.doi.org/10.2139/ssrn.2613361

Stephan Müller (Contact Author)

University of Goettingen (Göttingen) ( email )

Platz der Gottinger Sieben 3
Gottingen, D-37073
Germany

Holger Andreas Rau

University of Goettingen (Göttingen) ( email )

Platz der Gottinger Sieben 3
Gottingen, D-37073
Germany

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
50
Abstract Views
718
PlumX Metrics