Individual and couple decision behavior under risk: evidence on the dynamics of power balance
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This article 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, we assess how the risk preferences of the two spouses aggregate when they make risky decisions, and we shed light on the dynamics of the decision process that takes place when couples make risky decisions. We find that, far from being fixed, the balance of power within the household is malleable. In most couples, men have, initially, more decision-making power than women but women who ultimately implement the joint decisions gain more and more power over the course of decision making.
KeywordsBalance of power Experiments Household decision-making Risk
Many thanks are due to two constructive and helpful referees whose comments improved this article considerably. We are especially grateful to one of the referees who encouraged us to develop our ideas more fully. Research assistance has been provided by Sascha Bähr, Andreas Dittrich, Hendrik Ehrhardt, Andreas Lehmann, Anika Littmann, Dirk Pogode, Christoph Röber, and Torsten Wollina. We acknowledge the financial and technical supports from the Institut National d’Etudes Démographiques, and the French National Research Agency (research program “RiskAttitude”, ref. ANR-05-BLAN-0345-01). Valuable suggestions were provided by seminar participants at the University of Virginia, Cergy-Pontoise (THEMA), Paris I, Paris II (ERMES), and Montpellier, and at INED, as well as by the members of the RiskAttitude consortium. We especially thank Olivier Donni for very useful discussions about the literature on collective models.
This article is distributed under the terms of the Creative Commons Attribution Noncommercial License which permits any noncommercial use, distribution,and reproduction in any medium, provided the original author(s) and source are credited.
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