Gender and Risk Aversion: Evidence from a Natural Experiment

• Type: Article in International Scientific Journal
• Date: 2023

Authors

Pacheco, L (Author) Other; Lobao, J (Author) FEP; Coelho, S (Author) Other

Journal

Title: Games

Vol. 14

Final page: 49

ISSN: 2073-4336

Publisher: MDPI

Indexing

ISI Web of Knowledge - 3 Citations

ISI Web of Science

Scopus - 4 Citations

ProQuest

Econlit

DOAJ

EBSCO

Other information

Authenticus ID: P-00Y-HJE

DOI: 10.3390/g14030049

Abstract (EN): The theoretical literature on risk aversion and Expected Utility Theory is extensive; however, the analysis of this behaviour with natural experiments could be more comprehensive. In this paper, we use data from 120 episodes of the Portuguese version of the TV game show The Price is Right, namely from The Wheel game, to explore risk aversion as well as the impact of gender in decision-making. The Wheel game has straightforward rules and huge expected payoffs. All contestants have access to the same information and distributions of uncertainty, making it a unique field laboratory to conduct an experimental test of rational decision theory. The objective is to infer the risk aversion levels of decision-makers from their choice to turn the wheel and the influence of gender on risk attitudes. There is a widespread view that women are more risk-averse than men. However, we could not reject the hypothesis that women and men have the same level of risk aversion. Nevertheless, we have evidence that contestants are more risk-averse than risk-seeking. The omission bias, loss aversion and regret can explain that behaviour.

Language: English

Type (Professor's evaluation): Scientific

No. of pages: 16