The Intergenerational Transmission of Risk Preferences: Evidence from Field Experiments in China and Korea

38 Pages Posted: 29 Dec 2021 Last revised: 11 May 2023

See all articles by Bobae Hong

Bobae Hong

Claremont Colleges - Claremont Graduate University

Kichang (David) Kim

Claremont Colleges - Claremont Graduate University

Yuxin Su

Université Côte d'Azur - SKEMA Business School

Date Written: April 8, 2023

Abstract

In this study, we conduct field experiments with 196 worker-parent pairs from two companies in China and South Korea and explore factors that affect the similarity of risk preferences between parents and their offspring. In the Chinese data, we show more similar risk preferences between parents and their offspring when there are higher levels of parental involvement and financial parenting. In contrast, in the Korean data, a more demanding parenting style contributes to intergenerational transmission. These effects are mainly captured by the intergenerational transmission from Chinese mothers to their offspring and from Korean fathers to their offspring. In addition, we find that in our study, same-gender transmission contributes highly to intergenerational transmission, and the risk preferences of Chinese workers and their parents are more similar than those of Korean workers and their parents. We also discuss potential differences in the intergenerational transmission of risk preferences between China and Korea and Western countries. Our study provides a better understanding of the formation of individuals’ risk preferences.

Keywords: Intergenerational Transmission, Risk Preferences, Field Experiment, China, Korea

Suggested Citation

Hong, Bobae and Kim, Kichang (David) and Su, Yuxin, The Intergenerational Transmission of Risk Preferences: Evidence from Field Experiments in China and Korea (April 8, 2023). Available at SSRN: https://ssrn.com/abstract=3995987 or http://dx.doi.org/10.2139/ssrn.3995987

Bobae Hong

Claremont Colleges - Claremont Graduate University ( email )

150 E. Tenth Street
Claremont, CA 91711
United States

Kichang (David) Kim

Claremont Colleges - Claremont Graduate University ( email )

150 E. Tenth Street
Claremont, CA 91711
United States

Yuxin Su (Contact Author)

Université Côte d'Azur - SKEMA Business School ( email )

Block A4-A5, N 99 Ren’ai Road
Dushu Lake Science and Education Innovation Dist.
Suzhou, Jiangsu 215123
China

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