Abstract

http://ssrn.com/abstract=1883770
 
 

References (43)



 
 

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School Environment and Risk Preferences: Experimental Evidence


Catherine C. Eckel


Texas A&M University

Philip J. Grossman


Monash University

Cathleen A. Johnson


University of Arizona - Department of Economics; Center for Interuniversity Research and Analysis on Organization (CIRANO)

Angela C. M. De Oliveira


University of Massachusetts at Amherst

Christian Rojas


University of Massachusetts at Amherst

Rick K. Wilson


Rice University - Department of Political Science

October 1, 2012

Journal of Risk and Uncertainty, Vol. 45, No. 3, 2012

Abstract:     
Using a field experiment eliciting the risk preferences of 490 9th and 11th grade students from a variety of school environments, we examine various factors influencing the development of these risk preferences. In addition to factors previously considered by economists (gender, ethnicity, height, and parental education) we also evaluate cognitive (proxied by math literacy) and emotional (proxied by patience and planning ability) development theories. There is substantially stronger support for the variables typically considered by economists; consistent with prior work we find that girls are more risk averse while tall and nonwhites individuals are more risk tolerant. Next, the impact of school characteristics on the development of risk preferences is examined. Two effects emerge: a peer effect and a quality effect. For the peer effect, individuals who are in a school with a higher percentage of students on free or reduced lunches are significantly more risk averse than those with a lower percentage of students from low-income families. For the quality effect, individuals in schools that have smaller class sizes and a higher percentage of educators with advanced degrees have more moderate levels of risk aversion. Further, school characteristics only influence the 11th graders in the sample-lending some support to a causal argument.

Number of Pages in PDF File: 46

Keywords: Risk preference, Field experiment, Teen

JEL Classification: C93, D81

Accepted Paper Series


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Date posted: July 13, 2011 ; Last revised: June 13, 2014

Suggested Citation

Eckel, Catherine C. and Grossman, Philip J. and Johnson, Cathleen A. and de Oliveira, Angela C. M. and Rojas, Christian and Wilson, Rick K., School Environment and Risk Preferences: Experimental Evidence (October 1, 2012). Journal of Risk and Uncertainty, Vol. 45, No. 3, 2012. Available at SSRN: http://ssrn.com/abstract=1883770 or http://dx.doi.org/10.2139/ssrn.1883770

Contact Information

Catherine C. Eckel (Contact Author)
Texas A&M University ( email )
5201 University Blvd.
College Station, TX 77843-4228
United States
Philip J. Grossman
Monash University ( email )
wellington road
Clayton, victoria 3800
Australia
+61399020052 (Phone)
Cathleen Amanda Johnson
University of Arizona - Department of Economics ( email )
McClelland Hall
Tucson, AZ 85721-0108
United States
Center for Interuniversity Research and Analysis on Organization (CIRANO) ( email )
2020 rue University, 25th Floor
Montreal, Quebec H3C 3J7
Canada
514-985-4000, ext. 3034 (Phone)
Angela C. M. De Oliveira
University of Massachusetts at Amherst ( email )
Amherst, MA 01003
United States
HOME PAGE: http://www.umass.edu/resec/faculty/deoliveira/index.shtml
Christian Rojas
University of Massachusetts at Amherst ( email )
Stockbridge Hall
80 Campus Center Way
Amherst, MA 01003-9246
United States
Rick K. Wilson
Rice University - Department of Political Science ( email )
Houston, TX 77005-1892
United States
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References:  43
Citations:  11

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