Changes in Risk Attitudes Vary Across Domains Throughout the Life Course

Risk attitudes are important predictors of various economic decisions and socio-economic outcomes. Although studies show that peoples’ general willingness to take risks decreases with age, there are few reports on the age dependence of domain-specific risk attitudes. Drawing on the Socio-Economic Panel (SOEP), this study employs a proxy variable approach to disentangle age from periodic and cohort effects, while allowing the age effect to take a flexible functional form. Our analyses indicate that the risk attitudes follow different patterns and functional forms dependent on the respective domains