Intergenerational Transmission of Risk Attitudes − A Revealed Preference Approach

41 Pages Posted: 29 Nov 2011

See all articles by Andrea Leuermann

Andrea Leuermann

affiliation not provided to SSRN

Sarah Necker

University of Freiburg

Date Written: November 1, 2011

Abstract

This study investigates whether the willingness to take income risks revealed by occupational choice is transmitted from parents to their children. Using data from the German Socio-Economic Panel (SOEP), we find that fathers' riskiness of job is a significant determinant of children's occupational risk, in particular sons' (excluding parent-child pairs with identical occupations). This is the first piece of evidence for intergenerational transmission of risk attitudes relying on real world behavior. It shows that not only individuals' own assessments of their risk attitudes correlate (found by previous studies) but also risk preferences shown in exactly the same situation.

Keywords: risk preferences, intergenerational transmission, occupational choice

JEL Classification: D12, D81, J24

Suggested Citation

Leuermann, Andrea and Necker, Sarah, Intergenerational Transmission of Risk Attitudes − A Revealed Preference Approach (November 1, 2011). SOEPpaper No. 412, Available at SSRN: https://ssrn.com/abstract=1965952 or http://dx.doi.org/10.2139/ssrn.1965952

Andrea Leuermann (Contact Author)

affiliation not provided to SSRN ( email )

Sarah Necker

University of Freiburg ( email )

Fahnenbergplatz
Freiburg, D-79085
Germany

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