Are Commercial Fishers Risk Lovers?
AbstractEmpirical studies of fishers’ preferences have found that most fishers are risk-averse, while expected-utility theory predicts risk neutrality even for sizable stakes. We test this prediction using data from a stated choice experiment with Swedish commercial fishers. Our results show that almost 90% of the respondents do not behave as expected-utility maximizers. 48% of the fishers can be broadly characterized as risk-neutral, 26% as modestly risk-averse, while 26% are strongly risk-averse. Fishers are more risk-neutral the higher the fraction of their household’s income comes from fishing, while fishers with a positive attitude to individual quotas are more risk-averse. Sensitivity testing implies that decisions with modest stakes like a few days of fishing are not influenced by wealth level.
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Bibliographic InfoPaper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 90.
Length: 25 pages
Date of creation: 26 Feb 2003
Date of revision:
Publication status: Published in Land Economics, 2004, pages 550-560.
Note: Published in Land Economics, 2004, Vol. 80, pp. 550-560.
Contact details of provider:
Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/
More information through EDIRC
Expected utility; Prospect theory; Risk preferences; Stated preferences; Swedish fisheries;
Other versions of this item:
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
- Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
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