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Collective risk taking by couples: individual vs household risk

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  • Zheng, Jiakun
  • Couprie, Helene
  • Hopfensitz, Astrid

Abstract

101 real couples participated in a controlled experimental risk taking task involving variations in household and individuals’ income risks, but controlling for ex-ante income inequal- ity. Our design disentangles the effect of household risk, of intra-household risk inequality and of ex-post pay-off inequality. We find that most couples (about 79%) did pool their risk at the household level when risks were borne symmetrically but a significant proportion of couples (about 36%) failed to do so when individual risks were borne asymmetrically. Furthermore, we find that intra-household risk inequality has a larger impact on non-married couples than married ones.

Suggested Citation

  • Zheng, Jiakun & Couprie, Helene & Hopfensitz, Astrid, 2022. "Collective risk taking by couples: individual vs household risk," MPRA Paper 116537, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:116537
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    More about this item

    Keywords

    Experiment; Income pooling; Household risk taking; Inequality;
    All these keywords.

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D19 - Microeconomics - - Household Behavior - - - Other
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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