Preferences Over Social Risk

University of Central Florida Working Paper No. 05-06

33 Pages Posted: 6 May 2005

See all articles by Glenn W. Harrison

Glenn W. Harrison

Georgia State University - J. Mack Robinson College of Business

Morten I. Lau

Durham Business School

E. Elisabet Rutström

University of Central Florida - College of Business Administration

Marcela Tarazona-Gómez

University of Toulouse 1

Date Written: April 2005

Abstract

We elicit individual preferences over social risk. We identify the extent to which these preferences are correlated with individual preferences over individual risk and individual preferences over the well-being of others. We examine these preferences in the context of laboratory experiments over small, anonymous groups, although the methodological issues extend to larger groups that form endogenously (e.g., families, committees, communities). We find that social risk attitudes can be closely approximated by individual risk attitudes. We find no evidence that subjects systematically reveal different risk attitudes in a social setting compared to when they solely bear the consequences individually.

Keywords: Risk aversion, experimenal economics, social choice

JEL Classification: D71, D63, D81

Suggested Citation

Harrison, Glenn William and Lau, Morten Igel and Rutstrom, Elisabet and Tarazona-Gómez, Marcela, Preferences Over Social Risk (April 2005). University of Central Florida Working Paper No. 05-06, Available at SSRN: https://ssrn.com/abstract=714922 or http://dx.doi.org/10.2139/ssrn.714922

Glenn William Harrison (Contact Author)

Georgia State University - J. Mack Robinson College of Business ( email )

P.O. Box 4050
Atlanta, GA 30303-3083
United States
407-489-3088 (Phone)
253-830-7636 (Fax)

HOME PAGE: http://www.cear.gsu.edu/

Morten Igel Lau

Durham Business School ( email )

Mill Hill Lane
Durham, DH1 3LB
United Kingdom

Elisabet Rutstrom

University of Central Florida - College of Business Administration ( email )

PO Box 161400
Orlando, FL 32816
United States

Marcela Tarazona-Gómez

University of Toulouse 1 ( email )

Place Anatole France
Toulouse Cedex, F-31042
France

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