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Do actions speak louder than words? Comparing the effect of risk aversion on objective and self-reported mitigation measures

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  • Champ, Patricia A.
  • Meldrum, James R.
  • Brenkert-Smith, Hannah
  • Warziniack, Travis W.
  • Barth, Christopher M.
  • Falk, Lilia C.
  • Gomez, Jamie B.

Abstract

In this article, we empirically examine whether the relationship between risk aversion and self-reported risk mitigating behavior is similar to the relationship between risk aversion and an objective measure of risk mitigating behavior. Despite higher levels of risk mitigation in the self-reported measure relative to the objective measure, we find risk aversion is similarly correlated with both measures of wildfire risk mitigation. These results provide some confidence in the use of self-reported behaviors in examinations of risk preferences and risky behaviors, even if the self-reports understate objective behavioral measures.

Suggested Citation

  • Champ, Patricia A. & Meldrum, James R. & Brenkert-Smith, Hannah & Warziniack, Travis W. & Barth, Christopher M. & Falk, Lilia C. & Gomez, Jamie B., 2020. "Do actions speak louder than words? Comparing the effect of risk aversion on objective and self-reported mitigation measures," Journal of Economic Behavior & Organization, Elsevier, vol. 169(C), pages 301-313.
    • Handle: RePEc:eee:jeborg:v:169:y:2020:i:c:p:301-313
    DOI: 10.1016/j.jebo.2019.11.019
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    Cited by:

    1. Jennifer Balch & Katherine Curtis & Jack DeWaard & Elizabeth Fussell & Kathryn McConnell & Kobie Price & Lise St. Denis & Stephan D. Whitaker, 2021. "Effects of Wildfire Destruction on Migration, Consumer Credit, and Financial Distress," Working Papers 21-29, Federal Reserve Bank of Cleveland.
    2. Matthew R. Auer, 2024. "Wildfire risk and insurance: research directions for policy scientists," Policy Sciences, Springer;Society of Policy Sciences, vol. 57(2), pages 459-484, June.

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