Abstract

http://ssrn.com/abstract=1843326
 


 



Risk Preferences, Risk Perceptions, and Demand for Flood Insurance


Daniel R. Petrolia


Mississippi State University - Department of Agricultural Economics

Craig E. Landry


University of Georgia - Department of Agricultural & Applied Economics; East Carolina University - Department of Economics

Keith H. Coble


Mississippi State University - Department of Agricultural Economics

June 13, 2012


Abstract:     
We combine household-level data on the choice to purchase flood insurance with experiment-based risk preference data and subjective risk perception data. The sample covers a wide geographic area (the entire U.S. Gulf Coast and Florida’s Atlantic Coast) and includes individuals exposed to varying levels of risk. This work represents one of very few analyses to do so. Results indicate that our experiment-based measure of risk aversion over the loss domain positively and significantly correlates with the decision to purchase a flood policy, as do perceived expectations of hurricane damage, eligibility for disaster assistance, and credibility of insurance providers.

Number of Pages in PDF File: 46

Keywords: flood insurance, Gulf Coast, risk preference, risk perception, survey

JEL Classification: D81, Q20

working papers series





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Date posted: May 17, 2011 ; Last revised: May 29, 2013

Suggested Citation

Petrolia, Daniel R. and Landry, Craig E. and Coble, Keith H., Risk Preferences, Risk Perceptions, and Demand for Flood Insurance (June 13, 2012). Available at SSRN: http://ssrn.com/abstract=1843326 or http://dx.doi.org/10.2139/ssrn.1843326

Contact Information

Daniel R. Petrolia
Mississippi State University - Department of Agricultural Economics ( email )
Box 5187
Mississippi State, MS 39762
United States
Craig Landry (Contact Author)
University of Georgia - Department of Agricultural & Applied Economics ( email )
Athens, GA 30602-7509
United States
East Carolina University - Department of Economics ( email )
Brewster Building
Greenville, NC 27858
United States
Keith H. Coble
Mississippi State University - Department of Agricultural Economics ( email )
Box 5187
Mississippi State, MS 39762
United States
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