Health shocks and risk aversion

Arbeitspapier

Risk preferences are typically assumed to be constant for an individual across the life cycle. In this paper we empirically assess if they are time varying. Specifically, we analyse whether health shocks influence individual risk aversion. We follow an innovative approach and use grip strength data to obtain an objective health shock indicator. In order to account for the non-random nature of our data we employ regression-adjusted matching. Health shocks are found to increase individual risk aversion. The finding is robust to a series of sensitivity analyses.

Object Details

• ISBN: 978-3-86788-673-4
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Ruhr Economic Papers ; No. 581

Classification and Topics

• Classification: Wirtschaft ; Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access ; Microeconomic Behavior: Underlying Principles ; Criteria for Decision-Making under Risk and Uncertainty ; Health: General ; Health Behavior
• Subject: risk preferences ; health shocks ; hand grip strength ; regression-adjusted matching

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Decker, Simon ; Schmitz, Hendrik
• Event: Veröffentlichung
• (who): Rheinisch-Westfälisches Institut für Wirtschaftsforschung (RWI)
• (where): Essen
• (when): 2015

Further information

• DOI: doi:10.4419/86788673
• Handle: http://hdl.handle.net/10419/122193
• Last update: 10.03.2025, 11:42 AM CET