Intergenerational transmission of risk attitudes – A revealed preference approach

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in SOEPpapers on Multidisciplinary Panel Data Research at DIW BerlinThis series presents research findings based either directly on data from the German SocioEconomic Panel Study (SOEP) or using SOEP data as part of an internationally comparable data set (e.g. CNEF, ECHP, LIS, LWS, CHER/PACO). SOEP is a truly multidisciplinary household panel study covering a wide range of social and behavioral sciences: economics, sociology, psychology, survey methodology, econometrics and applied statistics, educational science, political science, public health, behavioral genetics, demography, geography, and sport science.The decision to publish a submission in SOEPpapers is made by a board of editors chosen by the DIW Berlin to represent the wide range of disciplines covered by SOEP. There is no external referee process and papers are either accepted or rejected without revision. Papers appear in this series as works in progress and may also appear elsewhere. They often represent preliminary studies and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be requested from the author directly.Any opinions expressed in this series are those of the author(s) and not those of DIW Berlin.Research disseminated by DIW Berlin may include views on public policy issues, but the institute itself takes no institutional policy positions. Abstract This study investigates whether the willingness to take income risks revealed by occupational choice is transmitted from parents to their children. Using data from the German Socio-Economic Panel (SOEP), we find that fathers' riskiness of job is a significant determinant of children's occupational risk, in particular sons' (excluding parent-child pairs with identical occupations). This is the first piece of evidence for intergenerational transmission of risk attitudes relying on real world behavior. It shows that not only individuals' own assessments of their risk attitudes correlate across generations (found by previous studies) but also risk preferences shown in exactly the same situation.

The development of risk aversion and prudence in Chinese children and adolescents

“…In their sample, risk aversion of boys decreases with age, while girls' risk aversion stays constant. 3 Several survey-based investigations have found positive correlation between the risk aversion of adult children and that of their parents (see, e.g., Kimball et al 2009, Dohmen et al 2011, Necker and Voskort 2014, providing evidence for the intergenerational transmission of risk aversion. In addition, experimental studies that correlate decisions in incentivized tasks observe correlations between children's and their parents' risk aversion: Levin and Hart (2003) find a significant correlation between the risk aversion of 6-to 8-year-old children and that of their parents (79% of them mothers).…”

The Strength of Gender Norms and Gender-Stereotypical Occupational Aspirations Among Adolescents

“…Most relevant to us, empirical studies have found that parents pass on work preferences (Blau et al, 2013;Fernández and Fogli, 2009), employers (Corak and Piraino, 2011), the choice of self-employment (Holtz-Eakin and Dunn, 2000), as well as occupations (Aina and Nicoletti, 2018;Chise et al, 2019;Hederos, 2016) to their children. Moreover, there is also empirical evidence suggesting intergenerational transmission in risk, and possibly other, preferences (Dohmen et al, 2012;Escriche, 2007;Necker and Voskort, 2014), including gender preferences themselves (Farré and Vella, 2013).…”

Intergenerational mobility of housework time in the United Kingdom

“…Dohmen et al (2012) analyse the inter-generational transmission of risk and trust attitudes, finding positive evidence of this. Necker and Voskort (2014) investigate whether children and parents show a similar willingness to take risk in their choice of occupation in Germany, and find that fathers' earnings risk is significantly positively related to sons' earnings risk despite that intergenerational transmission is weak in terms of effect size.…”