Prospect Theory Around the World

37 Pages Posted: 10 Nov 2011

See all articles by Marc Oliver Rieger

Marc Oliver Rieger

University of Trier

Mei Wang

WHU - Otto Beisheim School of Management

Thorsten Hens

University of Zurich - Department of Banking and Finance; Norwegian School of Economics and Business Administration (NHH); Swiss Finance Institute

Date Written: October 31, 2011

Abstract

We present results from the first large-scale international survey on risk preferences, conducted in 45 countries. We show substantial cross-country differences in risk aversion, loss aversion and probability weighting. Moreover, risk attitudes in our sample depend not only on economic conditions, but also on cultural factors, as measured by the Hofstede dimensions Individuality and Uncertainty Avoidance. The presented data might also serve as an interesting starting point for further research in cultural economics.

Keywords: Risk preferences, prospect theory, cross-cultural comparison

JEL Classification: D90, F40

Suggested Citation

Rieger, Marc Oliver and Wang, Mei and Hens, Thorsten, Prospect Theory Around the World (October 31, 2011). NHH Dept. of Finance & Management Science Discussion Paper No. 2011/19. Available at SSRN: https://ssrn.com/abstract=1957606 or http://dx.doi.org/10.2139/ssrn.1957606

Marc Oliver Rieger

University of Trier ( email )

15, Universitaetsring
Trier, 54286
Germany

HOME PAGE: http://www.banking-finance.uni-trier.de

Mei Wang

WHU - Otto Beisheim School of Management ( email )

Burgplatz 2
Vallender, 56179
Germany

Thorsten Hens (Contact Author)

University of Zurich - Department of Banking and Finance ( email )

Plattenstrasse 32
Zurich, 8032
Switzerland
+41-44 634 37 06 (Phone)

Norwegian School of Economics and Business Administration (NHH)

Helleveien 30
Bergen, 5045
Norway

Swiss Finance Institute

c/o University of Geneva
40, Bd du Pont-d'Arve
CH-1211 Geneva 4
Switzerland

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