Culturally Risk Averse? – A Model of Economic Growth with Endogenous Culture
This research studies the dynamic interplay between the evolution of cultural traits and the process of economic development. In particular, this paper shows how cultural attitudes, in this case differences in risk attitudes, influence economic decision making while at the same time illustrating how these attitudes endogenously change over time. In order to study this joint evolution of cultural and economic variables, an endogenous growth model is integrated with a cultural transmission mechanism along the lines of Bisin & Verdier. This provides us with a framework for the analysis of cultural attitudes that is both general and flexible so that it could be adapted for the study of culture in its full multidimensionality. The model predicts that higher economic success of more risk tolerant agents will over time lead to an increase in their representation in the society, which in turn will speed up economic growth. At the same time, though, the more risk averse type will not be completely eliminated. Using individual level data on risk attitudes across Chinese provinces, empirical evidence supporting this relationship between economic incentives and risk attitudes is provided.
|Date of creation:||Nov 2008|
|Contact details of provider:|| Postal: Dufourstrasse 50, CH - 9000 St.Gallen|
Phone: +41 71 224 23 25
Fax: +41 71 224 31 35
Web page: http://www.seps.unisg.ch/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Raquel Fernández & Alessandra Fogli, 2006.
"Fertility: The Role of Culture and Family Experience,"
Journal of the European Economic Association,
MIT Press, vol. 4(2-3), pages 552-561, 04-05.
- Raquel Fernández & Alessandra Fogli, 2005. "Fertility: The Role of Culture and Family Experience," NBER Working Papers 11569, National Bureau of Economic Research, Inc.
- Raquel Fernandez & Alessandra Fogli, 2005. "Fertility: The Role of Culture and Family Experience," Working Papers 05-14, New York University, Leonard N. Stern School of Business, Department of Economics.
- Fernández, Raquel & Fogli, Alessandra, 2005. "Fertility: The Role of Culture and Family Experience," CEPR Discussion Papers 5221, C.E.P.R. Discussion Papers.
- Kanbur, S M, 1979. "Of Risk Taking and the Personal Distribution of Income," Journal of Political Economy, University of Chicago Press, vol. 87(4), pages 769-797, August.
- Raquel Fernandez, 2007. "Women, Work, and Culture," NBER Working Papers 12888, National Bureau of Economic Research, Inc.
- Neher, Philip A, 1971. "Peasants, Procreation, and Pensions," American Economic Review, American Economic Association, vol. 61(3), pages 380-389, June.
- Fernández, Raquel, 2007. "Women, Work and Culture," CEPR Discussion Papers 6153, C.E.P.R. Discussion Papers.
- Shane, Scott A., 1992. "Why do some societies invent more than others?," Journal of Business Venturing, Elsevier, vol. 7(1), pages 29-46, January.
- Sherman Robinson, 1971. "Sources of Growth in Less Developed Countries: A Cross-Section Study," The Quarterly Journal of Economics, Oxford University Press, vol. 85(3), pages 391-408.
- Shaw, Kathryn L, 1996. "An Empirical Analysis of Risk Aversion and Income Growth," Journal of Labor Economics, University of Chicago Press, vol. 14(4), pages 626-653, October. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:usg:dp2008:2008-23. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joerg Baumberger)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.