Models and Mosaics: Investigating Cross-cultural Differences in Risk Perception and Risk Preference

Psychonomic Bulletin and Review, Vol. 6, No. 4, 1999

7 Pages Posted: 11 Oct 2006  

Elke U. Weber

Columbia Business School - Management & Psychology

Christopher K. Hsee

University of Chicago - Booth School of Business

Abstract

In this article, we describe a multistudy project designed to explain observed cross-national differences in risk taking between respondents from the People's Republic of China and the United States. Using this example, we develop the following recommendations forcross-cultural investigations. First, like all psychological research, cross-cultural studies should be model based. Investigators should commit themselves to a model of the behavior under study that explicitly specifies possible causal constructs or variables hypothesized to influence the behavior, as well as the relationship between those variables, and allows for individual, group, or cultural differences in the value of these variables or in the relationship between them. This moves the focus from asimple demonstration of cross-national differences toward a prediction ofthe behavior, including its cross-national variation. Ideally, the causal construct hypothesized and shown to differ between cultures should be demonstrated to serve as a moderator or a mediator between culture and observed behavioral differences. Second, investigators should look for converging evidence for hypothesized cultural effects on behavior by looking at multiple dependent variables and using multiple methodological approaches. Thus, the data collection that will allow for the establishment ofconclusive causal connections between acultural variable and some target behavior can be compared with the creation of amosaic.

Keywords: risk preference, risk attitude, cultural difference, China

JEL Classification: D81, D11, D12, D91

Suggested Citation

Weber, Elke U. and Hsee, Christopher K., Models and Mosaics: Investigating Cross-cultural Differences in Risk Perception and Risk Preference. Psychonomic Bulletin and Review, Vol. 6, No. 4, 1999. Available at SSRN: https://ssrn.com/abstract=930074

Elke U. Weber

Columbia Business School - Management & Psychology ( email )

3022 Broadway
New York, NY 10027
United States

Christopher K. Hsee (Contact Author)

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States

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