Individual and Couple Decision Behavior under Risk: The Power of Ultimate Control

This paper reports results of an experiment designed to analyze the link between risky decisions made by couples and risky decisions made separately by each spouse. We estimate both the spouses and the couples’ degrees of risk aversion and we assess how the risk preferences of the two spouses aggregate when they make risky decisions. This enables us to investigate the decision process that takes place when couples make risky decisions. We find that in most couples men have more decision-making power than women and that women’s decision-making power increases when they ultimately implement the joint decisions.