Risk Aversion in the Large and in the Small

Estimates of agents' risk aversion dier between market studies and experimental studies. We demonstrate that the estimates can be reconciled through consistent treatment of agents' tendency for narrow framing, regarding integration of background wealth as well as across risky outcomes: Risk aversion is similar whenever similar degrees of narrow framing is assumed in either setting.

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Authors:	HAUG, Jorgen ; HENS, Thorsten ; WOHRMANN, Peter
Subject:	Risk aversion \| narrow framing \| background wealth \| laboratory experiments \| market studies \| equity premium puzzle

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Extent:	application/pdf
Series:	Swiss Finance Institute Research Paper Series.
Type of publication:	Book / Working Paper
Notes:	Number 11-24 21 pages
Classification:	G11 - Portfolio Choice ; G12 - Asset Pricing ; D81 - Criteria for Decision-Making under Risk and Uncertainty
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010550283