Eliciting Risk Preferences: Firefighting in the Field

Utteeyo Dasgupta, Subha Mani, Smriti Sharma and Saurabh Singhal

No 9765, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Field constraints often necessitate choosing an elicitation task that is intuitive, easy to explain, and simple to implement. Given that subject behavior often differs dramatically across tasks when eliciting risk preferences, caution needs to be exercised in choosing one risk elicitation task over another in the face of field constraints. We compare behavior in the simple most investment game (Gneezy and Potters 1997) and the ordered lottery choice game (Eckel and Grossman 2002) to evaluate whether the simpler task allows us to elicit attitudes consistent with those elicited from the ordered lottery task. Using a sample of over 2000 Indian undergraduate students, we find risk attitudes to be fairly stable across the two tasks. Our results further indicate that the consistency of risk attitudes across the tasks depends on gender of the subject, quantitative skills, father's education level, and dispositional factors such as locus of control and Big Five personality traits.

Keywords: elicitation methods; experiment design; risk preferences; personality traits; India (search for similar items in EconPapers)
JEL-codes: C81 C91 D81 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2016-02
New Economics Papers: this item is included in nep-cbe and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Published - published as 'Internal and external validity: Comparing two simple risk elicitation tasks' in: Journal of Behavioral and Experimental Economics, 2019, 81, 39 - 46

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Related works:
Working Paper: Eliciting Risk Preferences: Firefighting in the Field (2016)
Working Paper: Eliciting risk preferences: Firefighting in the field (2016)
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