Risk Preferences in the PSID: Individual Imputations and Family Covariation
Survey measures of preference parameters provide a means for accounting for otherwise unobserved heterogeneity.This paper presents measures of relative risk tolerance based on responses to survey questions about hypothetical gambles over lifetime income.It discusses how to impute estimates of utility function parameters from the survey responses using a statistical model that accounts for survey response error. There is substantial heterogeneity in true preference parameters even after survey response error is taken into account.The paper discusses how to use the preference parameters imputed from the survey responses in regression models as a control for differences in preferences across individuals. This paper focuses on imputations for respondents in the Panel Study of Income Dynamics (PSID).It also studies the covariation of risk preferences among members of households.It finds fairly strong covariation in attitudes about risk -- between parents and children and especially between siblings and between spouses.
|Date of creation:||Feb 2009|
|Date of revision:|
|Publication status:||published as Miles S. Kimball & Claudia R. Sahm & Matthew D. Shapiro, 2009. "Risk Preferences in the PSID: Individual Imputations and Family Covariation," American Economic Review, American Economic Association, vol. 99(2), pages 363-68, May.|
|Note:||AP EFG ME|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
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- Miles S. Kimball & Claudia R. Sahm & Matthew D. Shapiro, 2007.
"Imputing Risk Tolerance from Survey Responses,"
NBER Working Papers
13337, National Bureau of Economic Research, Inc.
- Dohmen, Thomas J. & Falk, Armin & Huffman, David & Sunde, Uwe, 2012.
"The intergenerational transmission of risk and trust attitudes,"
Munich Reprints in Economics
20051, University of Munich, Department of Economics.
- Thomas Dohmen & Armin Falk & David Huffman & Uwe Sunde, 2012. "The Intergenerational Transmission of Risk and Trust Attitudes," Review of Economic Studies, Oxford University Press, vol. 79(2), pages 645-677.
- Thomas Dohmen & Armin Falk & David Huffman & Uwe Sunde, 2008. "The Intergenerational Transmission of Risk and Trust Attitudes," CESifo Working Paper Series 2307, CESifo Group Munich.
- Dohmen, Thomas & Falk, Armin & Huffman, David B. & Sunde, Uwe, 2006. "The Intergenerational Transmission of Risk and Trust Attitudes," IZA Discussion Papers 2380, Institute for the Study of Labor (IZA).
- Dohmen, Thomas J & Falk, Armin & Huffman, David & Sunde, Uwe, 2008. "The Intergenerational Transmission of Risk and Trust Attitudes," CEPR Discussion Papers 6844, C.E.P.R. Discussion Papers.
- Ulrike Malmendier & Stefan Nagel, 2011.
"Depression Babies: Do Macroeconomic Experiences Affect Risk Taking?,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 126(1), pages 373-416.
- Ulrike Malmendier & Stefan Nagel, 2009. "Depression Babies: Do Macroeconomic Experiences Affect Risk-Taking?," NBER Working Papers 14813, National Bureau of Economic Research, Inc.
- Miles S. Kimball & Matthew D. Shapiro, 2008. "Labor Supply: Are the Income and Substitution Effects Both Large or Both Small?," NBER Working Papers 14208, National Bureau of Economic Research, Inc.
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