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On the sources of risk preferences in rural Vietnam

Dang, Duc Anh (2012): On the sources of risk preferences in rural Vietnam.

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Abstract

In this paper, I provide a new empirical evidence that natural environment can shape individual risk preferences. By combining historical data on climate variation and contemporary survey questions on risk aversion, I find that risk aversion is significantly different for people who live in areas that have suffered high frequency of natural disasters. In particular, individuals highly affected by climate volatility show a long term risk aversion. The finding also supports the hypothesis that when people used to live in risky environment, an incremental increase in risk affects their risk preferences less.

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  • On the sources of risk preferences in rural Vietnam. (deposited 11. May 2012 05:02) [Currently Displayed]
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