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The development of risk aversion and prudence in Chinese children and adolescents
Citation Link: https://doi.org/10.15480/882.3287
Publikationstyp
Journal Article
Date Issued
2020-12-01
Sprache
English
Author(s)
Institut
TORE-DOI
TORE-URI
Journal
Volume
61
Issue
3
Start Page
263
End Page
287
Citation
Journal of Risk and Uncertainty 3 (61): 263-287 (2020-12-01)
Publisher DOI
Scopus ID
Publisher
Springer Science + Business Media B.V
This study experimentally evaluates the risk preferences of children and adolescents living in an urban Chinese environment. We use a simple binary choice task that tests risk aversion, as well as prudence. This is the first test for prudence in children and adolescents. Our results reveal that subjects from grades 5 to 11 (10 to 17 years) make mostly risk-averse and prudent choices. The choices of 3rd graders (8 to 9 years) do not differ statistically from risk neutral benchmarks, but at the same time they make mostly prudent choices. We also find evidence for a transmission of risk preferences. There is positive correlation between all children’s and their parents’ tendency to make risk-averse choices. There is also positive correlation between girls’ and their parents’ tendency to make prudent choices.
Subjects
Age effects
Children
Experimental economics
Prudence
Risk aversion
Transmission of preferences
DDC Class
004: Informatik
330: Wirtschaft
Publication version
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