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Individual Risk Propensity and Risk Background

Author

Listed:
  • April Bernard
  • Osaretin Iyare
  • Winston Moore

Abstract

The paper considers the role that socio-psychological and socio-cultural factors play in individual decisions to take risk. The study employs four main measures of risk propensity: the mean probability of engaging in an investment, insurance or everyday gamble and the amount that would be invested in a hypothetical lottery. The study finds that gender had a significant influence on the probability of engaging in investment and everyday risk decisions, but a relatively insignificant impact on insurance decisions. The most important risk background variables were experience in making gambling decisions and confidence in making investment decisions. Similar results are obtained when the lottery-type measure of risk was employed.

Suggested Citation

  • April Bernard & Osaretin Iyare & Winston Moore, 2008. "Individual Risk Propensity and Risk Background," Journal of Gambling Business and Economics, University of Buckingham Press, vol. 2(3), pages 53-70, December.
    • Handle: RePEc:buc:jgbeco:v:2:y:2008:i:3:p:53-70
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    References listed on IDEAS

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    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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