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Stability of risk preference measures: results from a field experiment on French farmers

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Abstract

We compare two different elicitation methods for measuring risk attitudes on a sample of French farmers. We consider the lottery tasks initially proposed by Holt and Laury (Econ Rev 92:1644–1655, 2002) and by Eckel and Grossman (Evol Hum Behav 23:281–295, 2002; J Econ Behav Org 68:1–7, 2008). The main empirical result from this within-subject study is that risk preference measures are affected by the type of mechanism used. We first show that this risk preference instability can be related to non-expected utility preferences of farmers. Using a risk-taking psychometric questionnaire, we then demonstrate that risk preferences of farmers are context-dependent. This may be another explanation of the observed risk preference instability.

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Authors and Affiliations

  1. Toulouse School of Economics (LERNA-INRA), Université deToulouse 1 Capitole, Manufacture des Tabacs - Bât.F, 21 allée de Brienne, 31042, Toulouse, France

    Arnaud Reynaud

  2. INRA, UR 875 BIA, 31326, Castanet-Tolosan, France

    Stéphane Couture

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  1. Arnaud Reynaud
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  2. Stéphane Couture
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Correspondence to Arnaud Reynaud.

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Reynaud, A., Couture, S. Stability of risk preference measures: results from a field experiment on French farmers. Theory Decis 73, 203–221 (2012). https://doi.org/10.1007/s11238-012-9296-5

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  • DOI: https://doi.org/10.1007/s11238-012-9296-5

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